A growing number of businesses all around the globe are adopting bitcoin and other digital assets for a variety of transactional, operational, and investment needs. Like every frontier, there are unknown hazards as well as compelling attractions.
Why could someone use crypto
One estimate from late 2020 states that there are well over 2,300 US companies that accept bitcoin, and that number excludes bitcoin ATMs. A growing number of businesses all around the globe are adopting bitcoin and other digital assets for a variety of transactional, operational, and investment needs.
This essay aims to provide you and your business a general overview of the kind of queries and considerations businesses should make when deciding whether and how to employ cryptocurrency. Therefore, it’s crucial to plan ahead, be ready, and participate in cryptocurrency in a strategic way if your business intends to do so.
There are two main ways to use crypto
When thinking about implementing cryptocurrency into your business operations, the first thing to decide is whether to use crypto-enabled payments or keep cryptocurrency on your balance sheet. You must carefully assess which approach best fits your company’s goals in order to choose the best course of action. Think about any possible advantages, disadvantages, expenses, risks, system needs, and other factors. As your business begins its crypto adventure, the parts that follow will provide some general thoughts on two distinct routes.
Facilitating payments “Hands-off”
Some businesses just utilize cryptocurrencies to make payments easier. Simply converting fiat cash in and out of crypto to receive or send payments without ever touching it is one way to ease payments. In other words, the business is adopting a “hands-off” strategy that prevents cryptocurrency from being recorded.
The simplest and quickest way to start using digital assets is maybe to enable crypto payments like bitcoin without adding them to the business’ balance sheet. It might be the company function that needs the fewest alterations overall and could help with short-term objectives like expanding customers and increasing the amount of each sales transaction. Businesses that utilize crypto in this restricted way often depend on outside providers.
The third-party vendor, acting as an agent for the business, converts cryptocurrency payments into and out of fiat money. This could be the best course of action. And because the “hands-off” strategy keeps cryptocurrency off the corporate balance sheet, it probably won’t create too many disruptions to a company’s internal operations.
The majority of the technical inquiries are dealt with by the third-party vendor, who will charge a fee for this service. The vendor also manages certain risk, compliance, and controls concerns on the company’s behalf. However, this does not automatically exonerate the business of all liability for concerns relating to risk, compliance, and internal controls. Companies still need to pay close attention to matters like the rules for AML and KYC (know your customer) programs. Of course, they must also adhere to any limitations imposed by the Office of Foreign Assets Control (OFAC), which is responsible for overseeing and enforcing the US government’s trade and economic sanctions.
