Are you thinking of monetizing your blog and using Bitcoin as one of the payment methods that your audience can use? While it’s definitely becoming more mainstream for businesses, especially eCommerce ones, to accept Bitcoin for their products/services, it’s still a gray area for most entrepreneurs.
Before you decide to accept payments with Bitcoin or any other digital currency for that matter, put in the research to make sure it’s the best move for your business. Here are some things you ought to know about accepting Bitcoin payments on your blog.
While Bitcoin has been enjoying the limelight for several years now through social media platforms, news outlets, and other channels, a large number of the human population remains oblivious as to what Bitcoin is. Some know that it’s a digital currency, but their knowledge doesn’t extend beyond that. If you decide to use Bitcoin as an accepted payment method on your blog, you’ll have to provide your audience with resources and marketing materials that give them a better idea of what Bitcoin is if you want more people to start using it.
There are no takebacks or reversal options available when transacting with Bitcoins. If a customer pays you via Bitcoin, he/she cannot dispute the charge days from now, like how they would with a credit card transaction. While this is good news for businesses that are frequently victimized by fraudulent credit card transactions, you’ll also need to establish a strong sense of trust between you and your customer base for them to be comfortable paying via Bitcoins. You’ll also want to have a fallback plan to handle possible refund requests from customers, including tracking how much cash each customer pays in Bitcoin.
Whether you’re receiving funds via cash or Bitcoins, you’ll have to factor in taxes lest incur heavy legal penalties. In 2014, the Internal Revenue Service decided to categorize virtual currencies as property when filing taxes. Businesses that opt to accept Bitcoin must then declare it as gross income based on its fair market value at the time the transaction was conducted. To put it in layman’s term, you are required to pay capital gains tax any time your cryptocurrency asset’s price increases resulting in a profit. As a general rule of thumb, only accept Bitcoins for large purchases, including luxury items.
One of the main draws of cryptocurrencies, including Bitcoin, is anonymity. There is no paper trail left to trace. But anonymity can also be a double-edged sword in that it can be used by black hat hackers or snydicate groups to conduct their nefarious activities. For this very reason, many countries, including China and India, have banned Bitconi. In the U.S., many key political figures, including treasury secretary Janet Yellen, has been calling for more regulations imposed on cryptocurrency in order to combat its misuse.
Accepting cryptocurrencies is a great way to keep your blog relevant in today’s tech-driven era. But simply integrating Bitcoin payments into your blog to look modern can lead to a myriad of problems in the future. Invest time to understand what Bitcoin is and how to manage it as a form of payment before you officially use it.