Since it first went live in 2009, Bitcoin has become one of the most talked about technologies of the past few years. The pioneering digital currency is now widely used by investors and consumers worldwide, serving as both a store of value and a means to make fast and instant online Bitcoin payments.
Although the price of Bitcoin has attracted considerable attention from media outlets, its function as an online payment processing service is far more interesting to business owners.
What Are Bitcoin Payments?
Bitcoin and other cryptocurrencies are forms of digital currency, but organizations, banks, and governments do not back them. Bitcoin is decentralized and runs on a peer-to-peer network. This means that any single person or entity does not control it, and it is wholly owned and operated by those who use it.
The blockchain is the primary technology behind Bitcoin’s success, a way of storing data. The Bitcoin blockchain stores transaction data and is publicly accessible for anyone to view. The information is kept up to date through a constant verification process, with each transaction verified before being stored.
Anyone can use Bitcoin anywhere, provided they have an internet connection. Sending it as a payment is as simple as copying the recipient’s wallet address and then using a personal wallet to send funds. The network handles the transaction, updating all blockchain copies with new information on who sent and received the funds. For those new to cryptocurrency, learning how to buy Bitcoin is the first step to utilizing this innovative payment method for online transactions or as a store of value. Platforms like MoonPay make it easy to purchase Bitcoin securely and start taking advantage of its versatility.
How Can Businesses Accept Bitcoin?
It’s now incredibly simple for businesses to accept payments made using Bitcoin. In the UK, a growing number of companies, both big and small, accept cryptocurrency payments. Around 2.3 million British people own cryptocurrency, and the number is growing yearly.
Businesses can accept Bitcoin payments both in-person and in-store. If you’re a brick-and-mortar business, you can benefit from Bitcoin just as if you only sell online. Now, countless apps work as POS machines to accept cryptocurrency payments. You simply need to enter the amount owed — and the app will generate a QR code for the customer to use.
Accepting Bitcoin payments online is even easier, with many e-commerce providers allowing you to include a cryptocurrency payment gateway. Once customers have completed their order, they select the Bitcoin payment and use the QR to send the money from their personal wallet. Services like PayPal now allow consumers and businesses to send and receive crypto quickly.
When accepting Bitcoin payments, it’s important to consider the taxation implications. Converting cryptocurrency to fiat may result in capital gains tax, so it’s important to discuss this with your accountant before accepting crypto payments.
Advantages of Accepting Bitcoin Payments
There are several benefits to accepting Bitcoin payments, which is why so many more businesses now allow customers to pay for goods and services using Bitcoin and other cryptocurrencies. Here are some of the main advantages:
- Lower processing fees – Most payment processing services come with fees that have significant implications for your business. Reducing the fees you pay to process transactions can be significant, especially if you’re processing a high volume or have low margins.
- More convenience for consumers – Consumers often avoid spending money in a business if it’s inconvenient, choosing to shop elsewhere instead. As crypto adoption becomes more widespread, having the option to pay for goods and services in Bitcoin will become ever more important.
- Secure payments – Cryptocurrency payments are highly secure, with no need to store user details. As long as consumers have the right protections, they can shop confidently.
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