Cryptocurrency is a virtual currency or in other words, it is a digital asset. It is secured by cryptographic protocols that make it impossible to spend it a second time or fake it. Mostly cryptocurrency based on blockchain ledger supported by computer networks. Cryptocurrency is decentralized; that means that it’s generally not regulated or issued by some authority it makes it immune to government manipulation.
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All of that makes it a good option for daily transaction needs, trading, and investing.
How does a Cryptocurrency transaction work?
As you probably guessed already the transactions in conventional payment processing and cryptocurrency payment processing differ.
The obvious difference- the cryptocurrency is being transferred instead of fiat currencies. And people pay not through a credit card, but a digital wallet.
What is a digital wallet and how does it work?
A digital wallet comes in the form of software or an app that allows accepting and paying in crypto. It functions in a similar way to a bank account but digital wallets are decentralized. There are two types of them:
- Single-currency. The accounts only accept and store a single currency like DASH wallets, for instance
- Multi-currency. It should be obvious how it is different- more currencies are available for your account.
How do You receive payment on Cryptocurrency?
If you have a merchant account like the ones WELCOINEX offer, all the cryptocurrency transactions can be automatically exchanged to your fiat currency. Or just share your wallet address with the person you want to accept payment from.
What is the most popular cryptocurrency?
- Bitcoin or Beta C like it’s called officially. It’s the most popular one and sits on the top of the blockchain. It has recently reached a price of 22000 USD for one Bitcoin.
- Ripple. On a worldwide scale, it’s the second popular cryptocurrency today. The surveys show that 1.8% of cryptocurrency owners used it for payments.
- Litecoin. The number of Litecoins in circulation is 66,112,886 coins compared to 16,530,563 coins for Bitcoin. And the USD market cap reaches $7,256,184,162.
Pros and cons of accepting Cryptocurrency as a payment method
If you’re still thinking whether it worth the effort to accept cryptocurrency as a payment method here’re the main pros:
- Low fees. When compared to bank transaction fees the fees for crypto transactions are as low as it can get.
- No refunds. Once the transaction is over there’s almost no ways to make a refund. It makes crypto a good option for high-risk businesses.
- Transaction speed. Usually, it takes a few seconds to finish the transaction. And compare it with bank transactions which can take up to several days.
All of the mentions cons may make cryptocurrencies look perfect and infallible but there’re cons you should be aware of:
- No e-wallet. You can’t use crypto like you use Paypal or Webmoney, but considering the trend of huge companies accepting BTC, that might change in the future.
- Fluctuation. The price of tokens is not stable, and by just keeping crypto in your wallet you can lose a lot of money or earn a lot without doing a thing.
- Redirections. Customers redirected to their wallets after payments. And people hate redirections.
What do you need to start accepting cryptocurrency?
After the decision is made you should perform additional steps to fully adopt crypto as a payment method. The first thing you should do is to find a merchant, if you haven’t picked one yet, you can open a merchant account with WELCOINEX.
To open a merchant account you need the following documents:
- Certificate of incorporation.
- Certificate of incumbency (or equivalent).
- Passports’ copies of all company owners and officers with their signatures.
- The processing history.
That’s pretty much everything you need to know to start accepting cryptocurrency for your business. Don’t miss the opportunity.