The FED & the US government came to the conclusion that Bitcoin and other Crypto currencies aren’t the bad boy around the block or that they are “evil” at the end of May. Both of them also continued by saying that Crypto could be advantageous to companies. The US and other governments admitted that digital currencies have arrived and are here to stay.
· Diversification and versatility.
In recent years the financial crisis hit us all pretty hard but more so the local and small businesses. The massive lay-offs, the high percentage bankruptcy of small businesses all had an effect on our communities. During these times of crisis and financial woes, many economic professors tried to offer a solution to the problem. Many prominent figures, including renowned professors like Prof. Dr. Browning, tried to help by giving lectures and advice to the entrenched and struggling businesses.
One of the most frequent answers is that the banks would open the money flow and give access to the much needed funds and loans for the companies. This is basically following the Keynesian way of thought, which says that in order to overcome an economic crisis one need to invest more in businesses.
As we all know the banks didn’t want any of that so the banks forced the businesses to cut in their employment, which had an effect on the buying power of the populous. The stiff competition and the unwillingness to extend loans devastated the remaining small & local businesses.
This alarming trend was spotted by some theoretical economic professors. They wanted to inform & possibly help these businesses, big and small, to weather the turbulent crisis. They devised a diversification and versatility idea. The idea was heavy on theory but the implementation and how it would benefit a company was not well thought of.
How would a company with debt or who is struggling in these difficult times change their strategy? Is that even possible? How does one use a diversification in an already strained company? What would that mean?
The answer may be in the crypto currencies. Crypto is, as we all know, another viable payment method. This will mean that a company can have a more diverse income basis. That way a company can “weather” times of crisis better because it hasn’t “laid his/her eggs in one basket” so to speak. Because of this diversification, the company will be more versatile, provided the management reacts promptly on developments in and around the business.
For example: a small grocery shop in a village sells all kinds of products. However the owner discovered his/her way to the crypto world and wants to see if there is a demand after crypto payments for his/her goods. So he starts up a small project to see if there is any demand, in which he/she includes common items.
After a while it seems successful and thus our grocery shop owner expands the crypto payment option to nearly every item in his or her shop. That way he/she has 2 kinds of “money”: the “real” paper money or fiat, and the digital currency.
In doing so these shop owners will generate the necessary versatility in times of misfortune. This modus operandi can be mixed in with bigger companies, though they may have other regulations that can prohibit the use of crypto. It all depends on the laws of the country that the companies are situated in.
We can conclude that Crypto currencies have the potential to stimulate all businesses in these times of crisis, provided that they are correctly incorporated in any business plan. There must also be a certain “know how” in the company or with the shop owner to begin with Crypto.
Nevertheless, the cost/risk is very low for companies when they try offering Crypto as another viable payment option for their goods and services. It is up to the crafty businessmen and –women to pick up on this obvious avenue.