Accepting Bitcoin Payment for Jewelry
Posted on May 30 2018
Crypto Here to Stay!
Cryptocurrencies like Bitcoin, Bitcoin Cash, and Ethereum are moving closer to public acceptance. Despite the skeptics and the recent meltdown, JP Morgan acknowledged that cryptocurrencies are “here to stay.” Recently, Skandiabanken – a Norwegian online bank, recognized Bitcoin as a new investment class, allowing customers to access their Bitcoin holdings through their banking platform. Wall Street has already introduced cryptocurrency funds, which are high in demand. Moreover, governments are discussing regulations rather than bans or prohibition. Some are already adapting the technology; the State of Arizona is in the process of passing a bill that will allow citizens to pay taxes in Bitcoin!
As of April 29th, 2018, there was $432 billion, invested into all cryptocurrencies (market cap). Of that, Bitcoin reigns supreme with $158 billion or ca. 37% of the total. Ethereum ($67.5 billion), Ripple ($33.7 billion), Bitcoin Cash ($24.5), and EOS round out the top five. One year ago, the total market cap was only $35 billion. Hence, those who got in early, multiplied their investments by over 12x, turning $1000 in $12,000!
CNBC: This crypto-millionaire bought a Lamborghini for $115 thanks to bitcoin Ali Montang – Feb 7, 2018
Although there are a few selling jewelry for the cryptocurrency, there still exists a tremendous opportunity to the upside. Many of these newly minted millionaires understand the need to diversify their winnings into hard assets, taking any opportunity to swap their electronic coins for tangibles, which will outlast any technological or regulatory changes.
Enabling Cryptocurrency Payments
There are over 1700 different cryptocurrencies out there. However, most regard Bitcoin, Bitcoin Cash (an offshoot of Bitcoin), Ethereum, and Litecoin as the “blue chips.” As the most widely used, they easily convert to regular currency (USD, EUR, NOK, CHF, etc.) as well as acting as a medium of exchange for the numerous small and upstart cryptocurrencies.
There are several ways to accept cryptocurrency payments:
Direct: Use a QR code, representing a payment address. Regarding transaction fees, this is perhaps the cheapest way but also the most time-consuming, manually matching the payments to the orders and then converting the crypto payment to regular currency.
BitPay is one of the first to offer solutions that seamlessly convert crypto payments, made on the web, to regular currency, deposited directly into a business account. Their plugin integrates with Shopify, Magento, and WordPress, allowing customers to pay in Bitcoin. They also offer tablet and phone-based payment systems for in-store or on-site transactions, automatically converting crypto to regular currency.
eGifter: Purchase gift cards with Bitcoin.
Gift Cards: eGifter offer pre-paid gift cards, which can be bought with cryptocurrency but redeemed for regular currency. The customer can buy these cards online or instore.
Taxation: The BitPay and Gift Card solutions do not have any extraordinary tax implications since the money, deposited to your business account, is regular currency. Therefore, it will be taxed as ordinary business income, offset by your expenses. However, with direct payments the situation is different. Cryptocurrencies, regarded as assets, are treated like stocks. If you choose to hold the cryptocurrency and it goes up, you must report and pay taxes on the gain at the point of redemption – just like a stock. Conversely, if the crypto goes down, marking a loss at the time of sale, you can claim those losses against your income. (Please consult your accountant for detail.)
We will see various cryptocurrencies rise and fall, but the concept will remain for the foreseeable future. The uncertainty about which coin will succeed generates demand for products, regarded as a good investment, and purchasable via cryptocurrency. Enabling your website and publicizing the acceptance can boost your business with newly wealthy customers, seeking to not only express themselves but also diversify their holdings.
Norwegian Jewelry (Restack AS/Cortez Media Services LLC) offers digital consulting services, helping jewelry designers and goldsmiths accept cryptocurrency payments. It is much easier than you think! Please contact us for more information.