5 Reasons Every Business Should Accept Bitcoin

Created in 2008 by an enigmatic (and still unknown) inventor, Bitcoin has helped spark a revolution in finance, economics, and business. At its most basic, Bitcoin is an anonymous form of electronic payment based on complicated encryption. All payments are made in public though people involved in the transaction remain hidden.

The end result is a new way to pay for goods that one day might be standard for people everywhere. Currently, Bitcoin and other so-called ‘cryptocurrencies’ are used by a unique group of elite tech users. But usage is steadily increasing among mainstream audiences giving businesses cause to investigate accepting payment in Bitcoin.

Bitcoin Merchant Payment Process: An Overview

Accepting Bitcoin for payment might not be the right move, or even necessary, for every business. Large corporate operations with physical locations might not see much of a point in participating in the cryptocurrency. Smaller businesses and those that operate entirely online will immediately see the benefit of accepting Bitcoin.

1. Goodbye Chargebacks!

Credit card chargebacks are a bane to any business. In credit card processing, too many chargebacks related to your total transaction volume can result in cancellation of services from most merchant payment processors. With Bitcoin, businesses now have a chargeback free electronic option for accepting payment. Even better, this whole process avoids the established banks and clearinghouses that add fees to every step of a traditional credit card transaction.

2. Lower Fees for Certain Customers

As it was mentioned earlier, Bitcoin circumvents most transaction fees. When a business wants to convert Bitcoin into dollars (or any other currency), however, there will be transaction fees of one sort or another. Compared to credit cards, however, rates from Bitcoin exchanges are incredibly reasonable. The flat rate fee from Visa and Mastercard is 2.5 percent. Some Bitcoin exchange rates collect as little as 0.2 percent per transaction.

Another option is for businesses to automatically convert Bitcoin into merchants’ local currency. Services like Coinbase pay merchants once a day and charges one percent plus $.15 for every transaction. This enables customers to directly pay with Bitcoin on a business website while the merchant avoids dealing with the cryptocurrency directly.

3. Activist Customers

To be honest, less than one percent of people on the planet have ever used for held Bitcoin. Even though this sounds like a small number, this represents approximately 7 million people using Bitcoin for various reasons. For certain industries or organization, accepting Bitcoin can yield fantastic results. The Electronic Freedom Foundation or the legal defense fund for Edward Snowden would have obvious reasons for embracing the anonymity associated with Bitcoin transactions. Beyond nonprofits, there are advocates and fans that support the concept and even prefer to use Bitcoins wherever possible. Though this often takes the form of Bitcoin purchases for gift cards to major retailers.

4. Nothing to Lose

Accepting Bitcoin is fairly easy to implement. It’s also a reasonable option for many industries. Like most decisions in business, whether or not a specific company decides to accept Bitcoin should be made carefully. With that said, there’s little downside to accepting Bitcoin payments other than effort. Participation in this exciting new cryptocurrency could even attract coverage from various niche blogs and news outlets.

5. Accepting Investments as a Form of Payment

For the majority of businesses, Bitcoin will be a fairly small portion of total payment processing. Holding some or all Bitcoin revenue as an investment could yield a nice return. As more businesses and individuals become comfortable with the idea of Bitcoin, the demand for the limited availability currency will increase. Though fluctuations in the price of Bitcoin might be off putting to some, it certainly is an interesting proposition. Accepting a $268 payment for goods or services on March 16, 2015 was worth $416 a year later.