It is only a matter of time before cryptocurrency emerges from high tech obscurity and becomes mainstream. The number of cryptocurrencies continues to rise. The combined market cap of all cryptocurrencies was over $13 billion last year. They will remain a part of the financial landscape for the foreseeable future. Companies should begin to understand these instruments as soon as possible. You'll have an advantage over your competitors if you figure out high-tech currencies first.

The Same Thing, But Different

Several hundred cryptocurrencies are available for financial transactions. About 80 percent of the market capitalization comes from 12 of the most popular ones. They all exist exclusively in digital form. By using cutting-edge encryption technology, these financial instruments make transactions unique and secure.

As an example, Bitcoin uses a system commonly called blockchain, which timestamps every digital transaction successively for systemic verification. As a peer-to-peer financial transaction system, cryptocurrency has enhanced security, allowing it to function as a peer-to-peer system. With it, parties can conduct financial transactions without involving intermediaries like banks, which are needed with other financial instruments.

In terms of types of high-tech currencies that are available today, there are considerable differences. A deflationary currency limits the number of digital "coins" that can exist within the system. On the other hand, inflationary cryptocurrencies allow for additional currency to be added to the system. For example, Bitcoin is an example of the former, and Ripple is an example of the latter.

Crypto currency and Going International

Expansion into international markets can help your small business become more competitive. Global expansion usually brings a positive return within two years. Additionally, 34 percent of those who achieved returns did so within six months of going international. Using cryptocurrency can assist your small business in expanding globally. Furthermore, it will allow your company to be more effective than its competitors who have yet to embrace digital currencies.

As a peer-to-peer system, cryptocurrencies do not rely on a central bank or exchange system. It eliminates the hassles and costs of currency exchange for businesses that accept cryptocurrencies. Digital currencies have, in many ways, become borderless. In the coming years, cryptocurrencies will become an increasingly critical part of global business. With this technology, foreign exchange costs and risks can be avoided, enabling increasingly rapid, secure transactions.

In addition, since cryptocurrencies offer peer-to-peer transactions, they will empower both small businesses and individuals. Standard financial transactions are largely at the mercy of third-party intermediaries who facilitate them. When a bank invalidates a transaction, your business becomes caught in the middle. Since cryptocurrencies are P2P, intermediaries are eliminated. Small businesses can also avoid the costs and hazards of using intermediaries.

Security, Security, Security

Furthermore, cryptocurrency reduces two major costs that arise due to fraud or theft. Approximately $190 billion is lost annually to merchants due to fraud and credit card theft alone.

In contrast, cryptocurrency can offer businesses a reprieve from this threat. It is the cryptographic system that underpins these new digital financial instruments and therefore keeps them secure enough to be used for peer-to-peer transactions in the first place. a result, they are less prone to fraud than legacy payment systems commonly used by small businesses.

Moreover, these instruments offer both businesses and consumers additional protections. Businesses and customers alike can be protected from identity theft by using these encrypted currencies. Additionally, there is enhanced privacy for businesses and consumers with these currencies. Due to the absence of a third-party intermediary, financial transactions remain anonymous.

Having It Your Way

You can design an electronic currency to execute a specific transaction, such as a contract. Cryptocurrencies therefore eliminate many middlemen associated with complex financial transactions - notaries, brokers, lawyers, etc. Buying and selling real estate using this method can save businesses and individuals’ considerable time. It also eliminates the high fees that these intermediary services charge. Furthermore, small businesses that use these currencies have a distinct advantage over less technical competitors.

One Last Thing...



Even though cryptocurrencies are new, they are here to stay. There are over 100,000 businesses that use these currencies every day. They are being followed by hundreds more every day. Businesses that refrain from adopting new currencies may have a difficult time keeping up with the competition. Understanding cryptocurrencies can help you stay ahead of a rapidly evolving financial landscape.