Cryptocurrency- What is it and How Important is it For Your Business
Cryptocurrency is digital money. It is created and managed through the use of advanced encryption techniques called cryptography. There has been a wave of increasing popularity with cryptocurrency in recent years and has varying implications for businesses.
Where did it Begin
Cryptography is an encryption technique that began out of the necessity for secure communication in World War II. With the advancement of the digital age, mathematical theory and computer science have improved upon the original techniques to create top cryptocurrencies like Bitcoin, Ethereum and Ripple.
These peer-to-peer electronic cash systems were birthed and gained popularity due to their lack of government control and interference. Not controlled by any central authority, cryptocurrency was hard to counterfeit, easy to be transferred, private and anyone could use it.
This should have taken off with online businesses right? Considering the massive shift to digital and e-commerce based businesses. However, the importance of cryptocurrency to business owners and the acceptance of it as payment depends on a few things.
Cons of Cryptocurrency
No one knows when this unregulated, private system will become universally accepted, regulated or when it will crash and burn. This means that investing in and placing trust in such a system is highly risky and uncertain.
Bitcoins and other forms of cryptocurrency aren’t regulated. It means that the threat of fraud and price manipulation is significantly higher than with traditional currency.
Because of the digital nature of the wallets, these cryptocurrencies are in, the threat of hackers and cyber threats are all too real. The crypto market is hosted on a vast amount of computers, there isn’t one central location where you can be protected with anti-virus and anti-malware software.
Transactions cannot be traced back to an individual, which is problematic, as persons see this as an opportunity to use cryptocurrencies to pay for and conduct illegal trades and businesses online.
But consider the future of crypto and your business for these reasons:
Raise Capital Quickly:
Cryptocurrency is a peer-to-peer network, it’s all online. It allows payments to be processed quickly and in one currency, no banks involved. For your business, this could mean raising capital quicker and cheaper.
Ease of Use:
With using the digital wallet, you can transfer crypto coins easily using a computer or an app on your smartphone or tablet. It is one centralized currency, with for instance Bitcoin, this means you won’t have to be concerned about exchange rates when you are trading and buying. There are no excessive fees or regulations.
When you trade you are using your wallet where your cryptocurrency is stored. All that is revealed to the vendor is your wallet ID. This protects your identity, your business identity, and the vendor’s identity.
With the steady rise of value in cryptocurrencies such as Bitcoins in recent years, the opportunity for you to increase the value of your business without excessive red tape is here.
As it is one centralized currency, for instance with Bitcoin, you don’t have to worry about exchange rates. When you are trading and buying Bitcoins feature no credit card fees, and they aren’t tied to any current regulations. You also don’t need to wait for payments as they are instant.
What to decide?
How cryptocurrencies will be adopted universally, is uncertain. The unregulated nature of the industry makes it hard to say how the currencies will forge ahead, with the elements that make it attractive to criminals.
Despite having equally great prospects for legitimate business owners. The Cryptocurrency future is not easy to predict. If it does gain even more popularity and trust that's great. Being aware of what cryptocurrencies are and how they work is the best thing you can do. When the time is right you can make the best decision for your business.
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