When you begin a startup, obviously you’ll want to make sure you’re set to accept money. Credit cards are always a plus; and cash is good in some circles, too, as it’s easier to keep track of locally. Checks, however, you should pass on, given their processing time and fees. But the real question is – should your startup buy Bitcoin?
As you may have noticed, Bitcoin gained a lot of traction over the past few years, with billions invested and taken out without breaking a sweat. But the market has also seen fluctuation lately, with some swearing they’d never mess with it again.
So the real question is – should your startup business have Bitcoin involvement? With that, let’s look at the pros and cons of it.
Bitcoin Could Save You Money in Some Circles
The first thing to understand about Bitcoin is why it’s popular. And most of that has to do with the money people save from it.
With cryptocurrency, you don’t have to worry about involving third-party processors with transactions. In other words, they happen direct; and you don’t have to show concern over paying third-party fees. That means more moolah in your pocket.
With that, if a consumer wishes to pay in crypto or Bitcoin for business services, you can also save from transaction fees. Bitcoin, for example, utilizes a smaller transaction fee rate than, say, most given banks. That’s why so many businesses are on board with the idea of cryptocurrency – it just saves cash overall.
Finally, Bitcoin doesn’t really have any sleep behind it. Whereas most banks only operate a certain number of hours each day (except for Sundays and holidays), cryptocurrency runs 24/7. It’s consistently traded on the market, and more than 30 percent of U.S. small businesses use it.
So, yes, cryptocurrency can be a hot commodity, depending on how you use it for your business. But beware, not everything about Bitcoin is shiny. So, not sold on if your startup should buy Bitcoin? Let’s take a look at the negatives of it.
It’s Not Really Cash In Your Hand
While Bitcoin holds tremendous value to some, the thing of it is it can all be gone in a heartbeat. As we mentioned above, the market is unpredictable, and billions can go bye-bye in a matter of seconds. There’s something questionable about putting reliance on funds that you don’t have in your hand. You could cash out, but it can take much longer than, say, getting a transaction at the bank.
Not to mention heavy security concerns as of late. As you may recall, Bitcoin is a growing cryptocurrency, still building billions. And that will bring business hackers. You can have the most advanced computer system in the world and they can still break in and steal your Bitcoin. As a result, you’ll have nothing to show for it, and your business could suffer as a result.
One key factor to keep in mind with Bitcoin (and cryptocurrency as a whole) is that it’s not regulated or backed by any government. That means it’s pretty much Mad Max when it comes to how people handle it. Can you make money off of it? Absolutely. Could it all be gone in a flash? Yep.
We’ve talked in the past about how certain markets live and die by cryptocurrency, and we’re serious as a heart attack when we say that. With the right business savvy, sure, it can be profitable. But it can also be a boon, especially if one blip causes billions to vanish.
Go Slow With Bitcoin and Cryptocurrency
So, should your startup buy Bitcoin? If you’re dead set on trying out Bitcoin and seeing what it does with your business, go slow with it. Don’t forget about your other methods of payment, because they’ll be vital for your business. Instead, experiment a little bit. Try taking a consumer or two that want to pay with Bitcoin and see what it does for you. If you can, get a financial expert to provide advice as well.
The key here is to test the waters. You wouldn’t jump into a lake without testing its temperature first, right? Of course not, you could easily end up cold. The same could be said for Bitcoin. You want to go slow and see where you can build upon it, or if it’s even right for you. If it’s not, you should be able to pull funds and go back to more traditional ways.
If it does work, however, you can try to take in more consumers. But keep a close eye on things. As valued as cryptocurrency is these days, it’s also highly unpredictable – and heavily unregulated. Something could easily go wrong. Keep it balanced and make sure your financial team doesn’t lose sight of it. And if it does lead to disaster, just get out and stick with regular payment methods. Your customers will generally understand. Good luck!