- The world’s business community is not a homogenous or a constant entity.
- However, one thing they all have in common is: they have to adapt to new technologies.
The world’s business community is not a homogenous or a constant entity — all kinds of businesses change for a variety of reasons. However, one thing they all have in common is: they have to adapt to new technologies.
Cryptocurrencies and blockchain in general are just the latest in a long line of revolutionary financial instruments. So, how and why are businesses adapting to this phenomenon in the past couple of years? We’ll examine the question in detail right here.
Why Resort To Crypto?
Plenty of businesses thrive on providing their clientele with the latest services and solutions for financial transactions. Normal currencies almost seem outdated nowadays, especially when compared to what crypto has to offer.
One of the most important traits of cryptocurrencies is adjustable scaling. Digital currencies work wonders regardless of the scale of the transaction, or the market conditions. Plus, these currencies aren’t operated by a single entity you’d have to depend on. Crypto transactions are based on code that is found on P2P worldwide networks — not depending on a single financial institution can mean more certain dividends in the long run.
Many people believe that cryptocurrency is less secure than traditional money — but the opposite is actually the case. There is an entire additional layer to the encryption found in cryptocurrencies, that is used to verify the validity of every single transaction. This encryption is also used to control the rate at which more currency is created. Such a system eliminates concerns about hyperinflation, for instance.
Additionally, any business entity or individual can partake in the cryptosystem without paying any sort of transactional fee. All networks are entirely open-source.
The security of currency based on blockchain is further ensured by the fact that this is an entirely digital kind of money. There is no danger of anyone ever physically stealing any sort of resources; it’s all held in digital wallets, and transactions simply mean a transfer to another entity’s digital wallet. There is no physical object whose exchange can be interrupted.
Speaking of digital wallets, their structure ensures complete anonymity of the owners - if they wish not to reveal their identity. In fact, the wallet is in no connection to someone’s personal identity. It exists on an address that is also encrypted and has no ties to identity numbers.
Considering all of this, the potential of blockchain currencies to disrupt the current order of the world’s financial system is astounding. That is why plenty of businesses have chosen to work with currencies like Bitcoin in an attempt to stay ahead of the curve.
One of the reasons for adopting cryptocurrency payments is the simple fact that there is an actual demand for it. In the past two decades, we have begun divulging an incredible amount of personal information to software companies. Tech giants like Google know pretty much everything about us — from our location to our purchasing preferences, with almost everything in between.
That’s why any digital solution that offers more online anonymity has quickly amassed a consumer following lately. And blockchain currencies are certainly on that list. Studies show that almost 40% would appreciate having the option of paying for their online purchases with bitcoin.
And these aren’t niche-customers either — we’re talking about general transactions, such as food orders or clothing.
Reducing Transactional Costs
Anyone who’s ever run a business knows that there are inherent costs to every transaction — expenses people don’t think about when they’re on the other side of the counter, even if it’s a digital one. Payment processing can take a huge chunk of any company’s revenue, and it’s usually something that you can’t affect all that much.
However, cryptocurrencies allow you to make a sizable dent in your transactional expenses. Crypto is more decentralized than any other type of currency on the planet. Thus, there is no central regulatory body to dictate the costs of doing business — which simply don’t exist. And let’s not forget that crypto trade is instantaneous, unlike most bank transfers.
Crypto transactions have heftier encryption than most other types of digital payments. This is definitely a game-changer, seeing as crypto has all of the security and backing that blockchain tech can offer. Most importantly — every transaction you make is final. There is no way of reversing anything, so you don’t have to worry about a bank blocking your account or overriding any kind of move you make.
There is no credit system with cryptocurrency, which may seem like a bad thing at first. But then you have to remember — there is no debt either. This makes it impossible to get into bad loans and spend funds you can’t afford to. Obviously, such a system of hard money makes fraud basically impossible because every transaction is incredibly simple.
For a small online vendor, reaching the biggest possible target audience is a big priority. If you can sell your services and products to a global audience, the potential for expansion is limited only by your own capabilities. This is what cryptocurrency offers, in terms of financial transactions. A crypto exchange can easily take place between any two people on the globe.
There are no obstacles to keeping your money as a digital asset and transacting with anyone. Not to mention the expenses usually related to international sales, and the ordeal of going through multiple middlemen entities. All of that is eliminated with cryptocurrencies.
So far, we’ve mostly tackled how businesses are adapting to crypto from a financial standpoint. However, there is another reason why cryptocurrencies bring incredible value to any business — marketing value. There is no better way to stand out from your competition than taking a stance for digital currencies and switching to crypto. Plus, you get a wider target audience from the sole fact that you’ve announced a switch to crypto — bitcoin and similar currencies boast passionate communities of their own.
And that wraps it up! We hope this little guide was helpful to you and that you feel more knowledgable on business adapting to cryptocurrencies in 2020. Stay safe, guys!