Anyone with more than 3 peas for a brain should know by now that accepting Bitcoin payments is best for business.
We have seen it proven by bigger companies as well : Chicago Sun-Times has a 11% increase in subscribers, TigerDirect & Overstock are receiving extra orders worth several hundreds of thousands US Dollars,…..
Yet a lot of companies are still hesitant , or even refusing, to work with Bitcoin because of its volatile nature when it comes to the fiat value. Understandably so, as you don’t want to make a loss when selling a product to someone. Playing it safe, sure, go ahead.
But how long can these companies keep playing it safe? People’s still receive fiat currency, but every month, you can buy and less and less with it because it’s losing value slowly, andn o one can tell you if it will ever increase in value again.
How much different is fiat currency from Bitcoin in that regard? The difference is that Bitcoin’s value can be checked by the general public on a variety of sites, yet the actual value of your fiat currency is a well-kept secret.
Just because your bank or government says that , for example, 20 USD is worth 20 USD, doesn’t make it worth 20 USD.
Let’s say you went out shopping, and buy a few bottles of soda, 2 bags of crisps, and some ice cream. You come at the counter and they ring you up for $19,97. Great, you have purchased quite a few items for your $20.
The month after, you visit the same store, you buy identically the same products, you have the exact same $20 in your pocket. They ring you up for $20,43. Wait a minute, there’s a price difference of nearly 50 cents compared to last month! (This is an arbitrary number to prove a point)
Does this mean your $20 you have today is still worth as much as the same $20 you had last month? No, because you can buy less with it. Sure, the prices on the goods you purchased went up, but why do these prices go up? Because the fiat value is losing ground.
Did anyone tell you, or let you look up, whether or not your $20 is still worth as much now as it was a month ago? Nope. And why would they? What are you going to do? Complain to the government? Good luck with that.
This is just a small example, but imagine running a store processing over $1,000,000 in orders every month. People buy things they need, like light bulbs, kitchen supplies, and other day-to-day things.
You, as CEO of a company, realise that the fiat value of the US Dollar is going down. So you have to raise prices a bit to cover your losses. You can’t raise them too much either, because people would notice. So you add on a few extra cents left and right, no one will care, right?
They probably won’t notice it during the first few months, but if it keeps happening every month, your monthly revenue will go down, because people can buy less and less each time without any explanation why. They’ll go looking for other outlets and a cheaper price, because they can’t comprehend why they can’t buy as much with their money anymore.
When you possess Bitcoin, on the other hand, you can see exactly why it’s losing or gaining ground on a day-to-day basis. You can read the stories behind the changes as well, because that information is publicly available.
The most important fact : Bitcoin’s value is determined by supply and demand. There is a finite supply of Bitcoins, and people want a certain price for their precious coins. It’s up to the buyers to counter the offer, and come to an agreeable price for both parties.
Fiat currency is infinite, as they can keep on printing more and more money, raise the debt limit, in order to fight a battle they can only stall, but never win, if it keeps up like this. “Oh, we need another 20,000,000 USD asap” It just gets printed, no questions asked, as no one gets access to the “why”, “what”, “where”.
Several businesses have taken bold steps in order to accept Bitcoin as a payment option, and it has paid off. Keep in mind that these are still the very early stages of paying with Bitcoin. Over time, we will probably, or hopefully anyway, see more crypto currencies being added, as they become more popular, and get noticed by a broader audience.
Is taking Bitcoin for payments a gamble? Yes. But if you really think about it, so is fiat currency. And in the end, when it comes down to “finite vs infinite”, we all know who’s going to draw the short straw. it won’t be Bitcoin or crypto currency, that’s for sure…