Risks and Dangers for Small Businesses Accepting Cryptocurrency

Cryptocurrency is now an instant, low-cost and secure payment alternative, and small businesses that accept it can distinguish themselves from their competitors. However, it is a risk and a steep learning curve that can be challenging for small-scale business owners to conquer.

Unlike traditional fiat currency, that is issued and controlled by central national governments, cryptocurrencies are decentralized and operate without a central authority. Blockchain technology is used to record transactions into an unchangeable and secure ledger. This lack of central authority allows businesses to cut transaction fees, which can vary from 2 to 5 percent, as opposed to up to 4 percent when using credit cards. It also eliminates the need for banks to verify every transaction, which can cut down on chargebacks that are fraudulent.

Demand and scarcity determine the value of cryptocurrencies. For instance, the number of people mining Bitcoin increases the coin’s value due to the fact that it decreases the amount of money that can be spent. Certain coins utilize a method known as burning to increase the value of their coins by destroying a small portion of the total supply.

The cryptocurrency market is rife with scams and fraud and it’s crucial for consumers and businesses to be aware of the risks. For example the truth is that no legitimate business will contact you via text message, email or social media soliciting money in exchange for products or services. Don’t click on links within unwelcome emails. These are typically phishing attacks designed to steal your computer’s personal information, like a username and password.


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