Over the last thirty years the way we do business has been transformed by technology, from communication to location, the average UK business would now be unrecognisable from its former self. As technology makes the world a smaller place, it’s becoming easier for businesses to transact across borders and subsequently across currencies. So if the way we do business is changing, why isn’t the way we pay for business changing?
The issue with our current currency system is that it is subject to influence from foreign exchange rates and overseas transaction fees meaning UK businesses pay more to transact their trade with the rest of the world.
Enter Bitcoin. As a decentralised virtual currency, Bitcoin presents business owners and consumers with a truly flexible and transparent payment system. Introduced in early 2009, Bitcoin allows users to transact directly without the need for an intermediary and allowing an international freely tradable currency vehicle. Since 2009 more and more institutions are accepting Bitcoin payments and specific Bitcoin exchange markets exist to convert the virtual currency into local currency. In 2013 the first Bitcoin ATM began operating in Canada and to date over 14 million Bitcoins are in circulation, to put this value into perspective the current exchange rate for GBP to Bitcoin is 171.6 – 1, representing over £2.4 billion in market capitalisation, and this number is consistently growing in an upwards trajectory.
Whilst larger companies can afford to experiment with Bitcoin transactions, it’s a little more risky for small businesses. The potential benefits may seem appealing but they are not without risk, from market fluctuations to security breaches, it’s probably best to wait until the currency stabilises. The most notable reason for small UK businesses to wait before adopting Bitcoin is its popularity, it’s not popular enough. For the currency to show real benefits to UK SME’s it will require trillions of global market capitalisation not billions. SME’s may find that there is a relatively small market of Bitcoin users.