Payments in the Digital Age - Should Your Small Business Accept Cryptocurrency?

June 9, 2022

Cryptocurrency has come a long way in a little over a decade. What started as a fringe experiment in 2009 has reached a point where nearly one-third of all small businesses accept these assets as a normal course of business. If you aren't on the bandwagon yet, is it time to join the crypto trend?

Even with its substantial growth, doubts remain about cryptocurrencies. This article will address the pros and cons of accepting these payments. At the same time, the information here will help you decide if accepting cryptocurrencies is the right move for your small business.

Cryptocurrencies hit the mainstream

There was a point not too long ago when cryptocurrencies existed in the shadows. It conjured images of international criminal organizations, hacker cabals, and the dark web. However, in a very short time, crypto has stormed into the mainstream, led by a rapid adoption of Bitcoin.

Just to highlight the progress the asset class has made in recent years, governments and major companies have begun to treat crypto as more than a passing fad. The nation of El Salvador accepted Bitcoin as legal tender last year and has been joined recently by the Central African Republic.

Meanwhile, a long list of some of the world's most recognizable companies have opened the door to crypto transactions as well. These include:

  • PayPal
  • Overstock
  • Starbucks
  • AT&T
  • Microsoft

A host of other companies have indirect crypto programs through partnerships, as well. This includes the fast-food chain KFC, which offered a Bitcoin Bucket in Canada that could only be purchased with the iconic cryptocurrency.

Crypto for small business

While almost 33% of small businesses allow customers to pay in cryptocurrencies today, this number will likely go up over time as crypto receives higher adoption rates generally. One estimate predicted a nearly 13% growth rate for the industry from now until the end of the decade.

For small businesses, then, some of the push to accept crypto comes from competitive forces. As large industry players take steps in that direction, startups and smaller firms need to follow suit, if only to remain relevant.

On the other hand, some companies view early adoption as a crucial marketing choice. Crypto might remain a small portion of sales at this point. However, taking the plunge now offers a differentiation point and helps burnish a reputation for cutting-edge innovation.

Crypto might remain a small portion of sales at this point. However, taking the plunge now offers a differentiation point and helps burnish a reputation for cutting-edge innovation.

So, whether your particular industry is already deep into crypto or pushing forward would make you an early adopter among your peers, there are some upsides to at least dabbling in the market. However, there are other considerations as well.

As you view the crypto landscape, go in with open eyes. Understand that taking the step comes with drawbacks as well as benefits. With that in mind, here are some additional pros and cons to consider:


Lower fees

Crypto works differently from services like credit card processing &#151 models that often come with high fees. Depending on the arrangements you make to receive crypto, you can reduce the cost of transactions, especially when dealing with large dollar amounts.

Borderless transactions

Part of the appeal of cryptocurrencies comes from their global scope. If you do significant business across borders, crypto can provide a low-cost, reduced-friction way to transfer funds between countries.


Added volatility

Yes, the asset class has the word "currency" in it. However, cryptocurrencies don't have the stability of traditional currencies, like the dollar or the euro. Instead, the value of cryptos can vary widely. For instance, in just the past year, Bitcoin has been at levels below $30,000 and at highs approaching $70,000.

Tax concerns

The payments that come in through a cryptocurrency are treated differently than cash or credit card payments. At its core, cryptos are seen as property by the tax authorities, so transactions involving them more resemble barter than a strict money transfer. As such, you should consider the implications as you proceed and make the necessary arrangements.

How to start accepting cryptocurrency payments

Before you decide to take the plunge into crypto, you also need to determine the best way to move into the market. With that in mind, here are a few steps that will ease your transition:

Understand the Market

Don't make an impetuous drive into the crypto market. Research your options first. There are a lot of details to determine. (For instance, are you just going to accept Bitcoin? Or step into other cryptos as well?)

Meanwhile, you need to protect yourself. The crypto market has a Wild West persona at this point. Scams are frighteningly common. At the same time, you don't want to get lost in fads, chasing the next Dogecoin.

Think about an Integrated Solution

Your crypto operations should dovetail with your overall payments program. Don’t just create a crypto process to pursue the craze. Instead, take the endeavor seriously and be sure to incorporate it as a sustainable part of your overall strategy.

Don’t just create a crypto process to pursue the craze. Instead, [dovetail your crypto operations with your payments program] and be sure to incorporate it as a sustainable part of your overall strategy.

Find Tech Partners

As a small business, you probably don't have the resources (either in time or expertise) to create a viable crypto program. You want to participate in innovative parts of the market. However, you don't want the process to become a distraction from your main business line.

To avoid this trap, look for a strong outside partner. A third-party processor can reduce many of the headaches. Finding the perfect partner might take some intensive research and discussions. But once that investment is done, you'll have a much better footing for your crypto operations.

Stay Flexible

Crypto is a fast-changing field. Whatever decision you make about the asset class today, be ready to review that position down the line. In other words, don't lock yourself into a stance. Instead, stay flexible and react to market preferences as they change.

Understanding the crypto opportunity

The reports are in. Consumers want businesses (including startups and small businesses) to accept crypto. In part because of this market pressure, more and more small businesses are making this possible.

However, optimizing your response to this trend requires thought. Every industry (and every individual company) has different dynamics. As such, use the information provided here as a starting point to determine whether accepting cryptocurrency payments is right for you.