Just a decade ago, cryptocurrency payments were only accepted by a handful of companies. Microsoft was one of the first major retailers to start accepting Bitcoin payments back in 2014. Since then, the acceptance rate of cryptocurrency payments has increased year by year. According to Cointelegraph Research’s Cryptocurrency Payments Report, there are currently approximately 420 million cryptocurrency owners worldwide, with more than 30,000 businesses accepting cryptocurrency payments.
The convenience and reliability of using blockchain can be beneficial to almost every existing industry. These include e-commerce, healthcare, insurance, real estate, and more. Industry giants like Burger King, Apple, Disney, and PlayStation now accept Bitcoin and other crypto as a payment. Major sports clubs are also joining the crypto club, with Crypto.com sponsoring an entire arena, home to the Los Angeles Lakers of the National Basketball Association, and Litecoin being named the "Official Cryptocurrency of the Miami Dolphins.”
Just in the past year, the adoption rate of crypto payments by businesses has tripled. It’s safe to say that business owners’ interest in crypto payments will continue to grow in the following years. Let’s discuss why these industries are rapidly adopting cryptocurrencies for their payment needs and how you can start using crypto payments for your own business needs.
Confidentiality
The biggest difference between traditional bank payments and cryptocurrency payments is the anonymity inherent in blockchain technology. Both the sender and receiver are able to keep their personal information, like their names, private.
Accessible Payments
Accepting crypto payments makes the business more accessible worldwide. The payment sender is only required to have access to the Internet to access the blockchain and send their payments. Making a transaction through the decentralized crypto wallet does not require a long and tedious identity verification or background check like most banks. Making a transaction across multiple countries’ borders is exactly the same as purchasing something in your city.
At the same time, not accepting crypto risks isolating a huge portion of potential customers. For millions of cryptocurrency users, it is the preferred method of payment, and not accepting it could push certain customers away.
Lower Fees
The fees that are required to receive and send cryptocurrency are very low and sometimes equal to zero. Depending on the coin, both businesses and their clients can take advantage of spending less per transaction than traditional bank payments. For example, a regular wire transfer can cost up to $50, while most crypto transactions cost $1–2 per transfer.
Transaction Speed
Blockchain is a peer-to-peer network, which means there is no intermediary party involved between the sender and receiver of the payment. Because transactions are sent directly from wallet to wallet, it only takes seconds for the blockchain to process them. Some coins, like Dash, Stellar, and Nano, boast transaction speeds of less than 2 seconds.
Security
While traditional banks may provide familiarity with the process, blockchain payments have tools that protect both the merchant and the customer. Firstly, for merchants, all payments are final unless agreed otherwise. This means that the customer is not allowed to initiate a chargeback on their side after the product or service has been provided and payment has been sent. On the other side, the customer has proof of purchase as soon as the transaction has been sent and recorded on the blockchain. The contract between the merchant and customer wallets is publicly available and can be viewed by anyone. This ensures the transparency of each sale.
Convenience
While some are enthusiastic about the self-custody of cryptocurrency, others may not be as familiar with the technology. These business owners are able to get help from entities within the blockchain ecosystem that provide outstanding services. For example, payment gateways like Zion Payments allow businesses to start accepting crypto payments quickly and safely while also having someone knowledgeable to contact if there are any issues. This is a great option for businesses that want to have easy conversions between currencies, bulk payouts, and instant withdrawals without the unnecessary hassle.
Inflation Resistance
While we are focusing on the convenience and accessibility of cryptocurrency payments, there is also, of course, the trading aspect. While most government-controlled fiat currencies are prone to losing value, cryptocurrencies like Bitcoin have historically only gained in value. Bitcoin supply is limited as opposed to fiat currencies like the dollar, and this protects it from inflation. According to the Grand View Report, the size of the worldwide cryptocurrency market exceeded $4.67 billion in 2022. Researchers also forecast a compound annual growth rate of 12.5% between 2023 and 2030.
How to Start Accepting Cryptocurrency
If you are considering accepting crypto as a payment for your business, it’s important to do some research and really understand the benefits and challenges of using crypto in your country. Some countries might have stricter laws and regulations on blockchain payments, while others allow any crypto payment without restriction.
The fastest way to start accepting crypto is to work with an established payment processor. It’s important to choose a reputable and efficient tool, like the aforementioned Zion Payments, which supports a wide range of cryptocurrencies and has a great customer response rate. With the help of a trusted payment provider, you will not have to learn the ins and outs of cryptocurrency payments on your own.
If you already use crypto and understand how crypto payments work, there shouldn’t be any major reservations about adding it to your business tools. In this case, you can use your existing crypto wallet to accept payments from any customer.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
