Cryptocurrency vs. Fiat: Which Currency Should Your Business Use?

Cryptocurrency has been slow to catch on, and at times, suffered from a poor reputation.

Cryptocurrency has been slow to catch on, and at times, suffered from a poor reputation. Fast forward to today, cryptocurrency has been drawing a lot of attention from consumers and merchants alike. It has also sparked the debate about which is better: cryptocurrency or fiat?

 

In truth, both have pros and cons. If you’re considering one or the other for your business, you’re probably wondering which is better for your goals. Some believe cryptocurrency is the better investment for the future, but others say that fiat is much more stable and therefore reliable. Here’s some information and tips that will help you choose the best option for your company.

 

What is Cryptocurrency?

 

Cryptocurrency is a digital or virtual currency that uses cryptography to secure transactions. It’s important to note that cryptocurrencices do not have a central issuing or regulating authority. Rather, the currency uses a decentralized system to record transactions and issue new units. Cryptocurrency can be used for goods and services or sent as a gift. It is also used as a form of investment for the future.

 

The market is currently flooded with different forms of cryptocurrency, some being more stable than others. According to experts, Bitcoin and Ethereum are two of the most settled forms of crypt today. Each of these currencies is founded in blockchain technology, ensuring there’s transparency in every transaction.

 

What is Fiat Money?

 

Fiat money is a type of currency that the government has declared legal tender but has no intrinsic or fixed value. It is not backed by any tangible asset, like gold or silver. Rather, it is backed by the government that issued it. The very opposite of cryptocurrency, fiat money is very centralized and is controlled by the government bodies. Examples of fiat currency include the U.S. dollar, British pound, and euro. It is also the choice for most central banks and is used in international trade.

 

The Pros and Cons

 

So, the big question: cryptocurrency vs fiat? What are the pros and cons of each option? Which is right for your business?

 

Because cryptocurrencies use blockchain technology, a decentralized and distributed ledger, all transactions are recorded and can be verified. It also makes it impossible for them to be tampered with or changed – very secure. Cryptocurrencies are also known for being incredibly fast, making it a great choice for businesses that need to make fast payments. 

 

On the other hand, the price of cryptocurrency is very volatile. This puts the value of a user’s investment at risk of going up and down, in some cases, very quickly. Cryptocurrencies are also not widely accepted, which could create problems for users in finding a business that will accept it as a form of payment.

 

Fiat currency is regulated, stable and widely accepted, definitely an advantage for businesses and consumers. However, fiat is subject to government control so they could hold the power to shut down your website and block access to your funds. 

 

Ultimately, the decision of which payment method is best for your business comes down to the type of business you’re running and your customers’ preferences. It’s also important to consider processing times, fees, security, and customer service. Just make sure you use the method that will help your business achieve sustainable growth.

Blair Thomas has been a music producer, bouncer, screenwriter and for over a decade has been the proud Co-Founder of eMerchantBroker, the highest rated high risk merchant account processor in the country. He has climbed in the Himalayas, survived a hurricane, and lived on a gold mine in the Yukon. He currently calls Thailand his home with a lifetime collection of his favorite books.