Across the US alone, more than 2,300 businesses now accept Bitcoin and other cryptocurrencies. These digital assets are being used for a variety of operational and investment purposes.
To truly understand how to tap every ounce of value out of cryptocurrencies, companies must gain clarity regarding the correct use of crypto.
Below are just some of the questions business owners should seek clarity on in order to understand why crypto is the future of commerce.
The Biggest Benefits
Companies across the world view cryptocurrency as a valuable tool. Below are just some of the biggest reasons why:
- Getting familiar with crypto by reading cryptocurrency guides and news can help position your company in anticipation of a future that may very well come to rely heavily on central digital currencies.
- Making full use of cryptocurrency could see your business gain greater access to new capital due to investments that have been tokenized.
- Crypto makes possible the real-time sharing of revenue. This greatly improves the facilitation of back-office reconciliation.
- Crypto opens up a host of new operational activities, including strengthened control over capital expenditure, secure transfer of money, and better management of the opportunities brought about by digital investments.
Two Streams Of Usage
For those businesses looking to embrace a digital future, there are two possible paths, or streams of usage.
The first of these is to use cryptocurrency simply as an accepted form of payment. This means a simple process of conversion without bringing crypto into the company’s actual balance sheets.
With this option, a third-party vendor will be appointed as an authorised agent for the company. The goal here is simply to reach new clients and reduce transactional fees.
In this instance, the third-party vendor will handle all technical aspects of trade, in return for a fee for the service rendered.
The second route is a much more hands-on approach and involves integrating cryptocurrency more fully into the scope of the company’s operations. Even in this instance, however, some companies still opt to appoint legal counsel to manage things like licencing rights, wallet management services, etc.
Wallets Play A Central Role
All cryptocurrency is held in digital wallets – much in the same way as how a traditional wallet would hold paper money.
As such, the correct type of wallet structure is crucial to running a successful crypto function within the treasury scope of the business.
Since wallet management plays such a central role in the success of cryptocurrency support, many companies opt to make use of a third-party vendor or “custodian”, whatever the scope of their involvement with digital assets.
Working Capital Security
Proper capital management is a challenge faced by most businesses.
A key question often asked is the level of operational cash available to the business, coupled with where that money is being held.
With crypto, however, every transaction is instantly locked until settled. And since every transaction is locked, it is practically impossible for the company to double-spend by accident. This creates a heightened awareness regarding the available operational cash.