Bitcoin has suffered a few hiccups along the way, like the recent Mt. Gox collapse, in which thousands of investors collectively lost around half a billion dollars when the company filed for bankruptcy. However, despite these challenges, Bitcoin is slowly but surely establishing itself as a viable alternative to regular currency. If you’re a small business owner and wondering whether or not you should accept Bitcoin as a means of payment, know that Bitcoin is actually a very secure way to make and receive payments. Does that mean you should use Bitcoins? It is actually a good idea to do so, as long as you’re cautious and realistic about the system. Here are 5 things to watch out for when using Bitcoins:
Make Sure Your Wallet is Secure
You don’t have to worry about the security of the Bitcoins on the other end, but you do have to worry about the safety of the coins at your end. There are viruses out there that will steal all the Bitcoins out of your digital wallet in a few seconds. Keeping your Bitcoins safe is actually not all that hard. For maximum safety, you should keep your Bitcoins in a computer
that isn’t connected to the internet. If you’re a small business owner, you should consider investing in a hardware Bitcoin wallet. Hardware Bitcoin wallets are not connected to your PC and are virtually hack proof.
Bitcoin Isn’t Always Anonymous
One of the most attractive features of Bitcoin is that all payments made and received are totally anonymous, at least in theory. If you have a service provider that supplies you with Bitcoins, it’s possible that the service provider publishes your information somewhere. You may also make your transaction public if you share a link of the checkout page. So be careful with whom, and how you share your checkout data. Your transaction is traceable, especially if you buy large amounts of goods with it. Unless you’re doing something illegal, this shouldn’t matter. And if you are, well, this is the very least of your worries!
Bitcoin Adoption is still growing
That’s both good news and bad news. There are millions of people out there using Bitcoins, but there are billions of people who use regular currency. Bitcoin is still in a fledgling state, so it’s not a good idea to put all your eggs in one basket and concentrate solely on Bitcoins. Only invest a part of your money (and time and energy) in Bitcoins, and don’t expect to make a lot of Bitcoins very fast very quickly. At the same time, because Bitcoins are still nascent, this is the right time to make the most of the publicity the switch to Bitcoins offers.
The Value of Bitcoins Will Fluctuate
Bitcoins are like ordinary currency and their value against the dollar, or the euro, may fluctuate a lot over a given time period (even if it is stable in the long run). It’s important that you be fair, realistic and knowledgeable when you assign Bitcoin prices to your goods or services. One way to mitigate against currency fluctuations, is to schedule frequent dollar conversions.
Today, Bitcoin is accepted by several major retailers and online businesses. If things go well, Bitcoin may even be accepted by PayPal as a means of payment in the near future.
If you haven’t already, now would be a good time to get caught up with some of our earlier Bitcoin Week posts like:
- The Essential Guide to Bitcoin
- Advice from Successful Companies
- Best Apps to Start Accepting Bitcoin
- How Bitcoin can Fuel your Business Growth