Recently I accepted a cryptocurrency payment. I did it mostly to learn the process, advantages and pitfalls first hand. The process was straightforward, although it did require getting a digital wallet and setting up an only crypto account. I chose Exodus for my wallet and BlockFi as my broker.
I’m still evaluating the extent to which I want to accept crypto payments. Cryptocurrencies have certain advantages. For example, for certain international customers, it’s a relatively easy way to pay me or perhaps the only way to pay me, although certain countries like China restrict cryptocurrencies. Assuming the value of the cryptocurrency rises, it can also be something of an investment. I got a 25% return on the bitcoin I was paid in over one month. Of course cryptocurrency prices can vary widely over short time periods, so it’s just as easy to lose 25% in one of these currencies over a given month too.
They also have certain downsides. You can’t buy much with cryptocurrencies, so to spend the “money”, you have to sell it in your local currency and move it into a traditional bank account. Also, the price of cryptocurrencies can fluctuate wildly over time. A currency of value doesn’t fluctuate that much over time, which is why I’ve only accepted U.S. dollars until recently. So to my mind these cryptocurrencies that exist outside of regulation and are subject to supply and demand really aren’t currencies.
The client paid me in bitcoin. bitcoin is a “dirty” currency in that it requires a lot of electricity to create new bitcoins. It’s estimated the electricity used just in creating bitcoin is equal to the electricity consumed by the Netherlands. Most of this electricity comes from carbon-burning power sources, contributing to climate change and global warming.
Consequently, if I accept payment in cryptocurrencies in the future, it’s going to be in more environmentally benign and relatively stable cryptocurrencies. Right now, ethereum qualifies.
My services will still be priced in U.S. dollars. You would have to pay me the equivalent in ethereum. But I do want to be clear that I don’t want to be paid in ethereum or any digital currency. If you can pay me in U.S. dollars, that’s what I prefer. In some cases though not accepting ethereum would be unprofitable, so I will make exceptions.
Assuming I accept cryptocurrencies for work I do for you, I will provide an address you can use to pay me at the appropriate time.
