The Impact of Crypto on Businesses

Cryptocurrencies have been a part of mainstream financial news for several years now. One of its newest milestones was reached when Bitcoin peaked at over $40,000. Another milestone was the creation of non-fungible tokens or NFTs. While these concepts may seem outlandish for non-technical folks, serial entrepreneur Robert Testagrossa indicates that savvy business owners now ask themselves whether these cryptocurrencies will one day affect their business.

Like all currencies, Bitcoin and other cryptocurrencies can be used as payments. This would circumvent many traditional institutions like taxing bodies, banks, and other middlemen-type services. However, Robert Testagrossa reminds business owners that cryptocurrencies were created mainly for this purpose.

While it's true that any business may accept cryptocurrencies as payment, using them for things like payroll may be a challenge. Fortunately, cryptocurrencies can now be covered by insurance or other financial products. As a result, you can hedge against the risk that your crypto accounts fluctuate wildly against the dollar.

Still, some risks are involved when smaller businesses openly advertise that they accept cryptocurrencies as payment. Businesses known to use or accept cryptocurrencies may risk getting targeted by cybercriminals looking to make a quick buck. To make matters worse, many small businesses usually don't have enough resources to combat hackers' attempts to steal their cryptocurrencies.

Robert Testagrossa mentions another risk of transacting with cryptocurrencies is the inherent possibility of the currency's value dipping due to unforeseeable forces. While such is the case for most tradable currencies or stocks, it's especially dangerous due to its purely digital form. In contrast to other forms of non-fiat currency used as money, such as gold or silver, cryptocurrencies have no inherent value. As a result, it is entirely possible for a digital currency's price to plummet to zero.

If you owned an enterprise, would you accept crypto? Why or why not? Share your thoughts with Robert Testagrossa in the comments section below.

For more on Robert Testagrossa’s insights on finance and business, check out this page.