One way that businesses today are seeking innovative means of adapting and thriving is through the adoption of cryptocurrency payments for your business. Once considered a niche technology, cryptocurrencies like Bitcoin and Ethereum have slowly gained mainstream acceptance, attracting a growing number of businesses and consumers alike.
By 2025, experts estimate the number of cryptocurrency users globally to have risen to 107.3 million. Although statistics show that the adoption of cryptocurrency for payments is still low, the numbers are growing and it is not far-fetched to predict the coming years will be game changers.
In this comprehensive guide, we’ll guide you through the essential steps for setting up cryptocurrency payments for your business. Providing you with the knowledge and tools to successfully navigate this exciting new frontier of commerce.
How Do Cryptocurrency Payments Work?
Cryptocurrency payment gateways are a popular way for businesses to accept crypto payments. Typically, these gateways act as intermediaries between businesses and their customers by accepting payments on behalf of companies and converting them to fiat currency.
In essence, this means, as a business, you don’t have to deal with the volatility and complexity of the market because you have decided to accept crypto payments. The following is an example of a series of steps that would take place to accept crypto payments:
- A customer pays through a payment gateway using an accepted cryptocurrency.
- The payment gateway locks in an exchange rate for a certain period. The system protects the parties in case the cryptocurrency’s value fluctuates during processing.
- The gateway converts the crypto value to the business’s preferred fiat currency.
- Settlement. Funds are deposited into the businesses’ bank account, often the next business day.
This is a straightforward method to accept cryptocurrency payments for businesses that don’t want to deal directly with handling crypto. Alternatively, other businesses may choose to accept payments directly into their own crypto wallet. The alternative method gives a business more control over its funds but also comes with more risks.
Benefits of Accepting Crypto Payments
This section discusses various advantages for businesses accepting cryptocurrency payments and why you should consider its implementation for your organization too.
- Lower Transaction Fees: Platforms offering credit card payments usually charge a flat fee plus a percentage of the transaction, which often amounts to more than 3%. By contrast, crypto transaction fees via gateways are typically around 1%.
- Access to a Global Customer Base: Since cryptocurrencies are borderless, businesses find it easier to reach an international customer base without incurring the typical costs associated with international transactions.
- Faster Transaction Speeds: Traditional payment methods often take several days to clear, especially when there are multiple intermediaries involved. But, crypto transactions can be processed more quickly.
- Reduced Risk of Chargebacks and Fraud: Once a cryptocurrency transaction is complete, it is recorded on the blockchain and cannot be reversed. On the other hand, credit card transactions are usually more vulnerable to fraud.
- Improved Security and Transparency: Blockchain technology ensures a high level of security and transparency that makes it virtually impossible to alter transaction records.
- Increased Customer Loyalty and Brand Image: These days, accepting crypto payments is a sign that a company is on par with the times and is forward-thinking. More tech-savvy customers, in particular, can have more affinity towards businesses that accept cryptocurrency payments.
Setting Up Cryptocurrency Payments for Your Business
Once you have decided that your business can benefit from implementing crypto payments, then you need to go through the steps highlighted in this section, starting with choosing a payment processor:
- Choose a Payment Processor
As mentioned earlier, using a payment processor can greatly simplify the process of accepting cryptocurrencies if you prefer limited exposure to the volatility of the crypto market. Popular processors are Coinbase Commerce, BitPay, PayPal, CoinPayments, TripleA, etc.
When choosing a cryptocurrency processor, consider factors such as transaction fees, supported cryptocurrencies, security features, ease of integration with your current e-commerce platform, support for point-of-sale transactions, and customer support, among others.
- Integrate with your E-commerce Platform
Secondly, you need to incorporate cryptocurrency as a payment option at checkout on your e-commerce platform. The integration process depends on the platform you use as well as the payment processor you selected.
Some processors, like PayPal, have crypto built into their checkout solution, while others may require plugin downloads. Major e-commerce platforms like Shopify, WordPress, BigCommerce, WooCommerce, etc. all offer plugins to integrate crypto payments.
If you’re using a crypto wallet instead of a third-party payment processor, you may need to manually integrate checkout options into your website. Additionally, if you’re accepting payments in person, you’ll need a crypto-compatible QR code scanner, NFC terminal, or mobile app.
- Legal Considerations
Before finalizing the decision to accept cryptocurrency payments, you need to consult with legal and financial professionals. The cryptocurrency industry is still in its growth phase and is subject to stringent, rapidly evolving regulations in various regions.
So, you need to do thorough homework to ensure that you are complying with all the local regulations and guidelines. They impact how you accept payments, report income, and pay taxes, among others.
- Implement Security Measures
Additionally, it’s crucial to be security-conscious. Criminals are attracted to the allure of crypto because of the anonymity of payments. So, businesses handling crypto assets need robust security measures.
Typically, the payment processor handles the bulk of the road. But if you opt for a hands-on approach using your own wallet, security is entirely your responsibility. Regardless, always stay informed about potential vulnerabilities.
- Educate Your Staff
As you take steps to implement crypto payments in your business, you must ensure that employees handling transactions have a basic understanding of cryptocurrency and blockchain technology. They should, at least, be able to answer customer questions, address any concerns, and provide clear instructions on how to complete transactions.
- Promote Cryptocurrency Acceptance
Once you are all set up, the next step is to actively promote it as a payment option. If you have a physical store, this means putting up signs. Also, integrate it as a payment option on your website and social media channels. You might even consider offering discounts for customers who pay with crypto.
Building a Global Business
Accepting cryptocurrency payments for your business is one way to demonstrate that you are becoming a global player. It is not just about following a fad; it can be a key growth strategy for your organization. For more actionable and insightful advice on building a business that can compete internationally, join several entrepreneurs, founders, executives, and leaders who follow Startup Growth Guide for business wisdom.
Featured Image by Freepik
About The Author
