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Not long ago, we gave some basic advice on how to deal with the rise of crypto currency. Because this is a topic that generates so much discussion, we wanted to revisit the subject today.

You have probably seen stories about Bitcoin and other crypto currencies in the news lately. Some small business owners and CEOs are starting to wonder whether they should trade in digital currencies, or perhaps accept them as payments.

Finance isn’t our area of expertise, of course, but from an IT perspective we can see three reasons you might want to avoid dabbling in crypto for the moment. Let’s take each one in turn to see if you agree…

#1 Crypto Currency Valuations Are Volatile
This is true from a financial perspective, of course, but also in the sense that the technology doesn’t have a long-term track record. While the valuations for each digital currency are swinging up and down wildly, it’s also true that some are appearing and disappearing out of nowhere.

We would tell you not to purchase the first generation of a new hardware device for your company if you can avoid it. That way other people can find the shortcomings (and let the manufacturer correct them) before you do. The same principle applies here.

#2 You Could Unwittingly Assist Organized Crime
It’s an unfortunate fact that many crypto transactions have their roots in organized crime, with drugs, illegal weapons sales, and even human trafficking being involved. The untraceable nature of the digital currency feeds these kinds of associations.

Only you can decide whether that is an ethical problem for your business or not. However, it suggests that in the future crypto transactions might face more scrutiny and regulation. That’s not great for business. 

#3 Crypto Mining Is Bad for the Environment

Some experts in our industry estimate that the amount of computing power that is being devoted to generating crypto profits could fuel a small industrialized country. That makes the trend toward crypto bad for the environment, at least in the short term.

Once again that may or may not be a point of concern for you and your business. However, as with the issue of organized crime, it suggests that some kind of tax or regulation might be on the way. You don’t necessarily want your business holding a great deal of money in a currency that suddenly can’t be exchanged without a large cost.

Should You Close the Book on Crypto?
If all of this sounds like we are being pessimistic about crypto currencies, that’s not actually the case. Some investors have done very well with Bitcoin, and the industry seems poised for growth. It is very possible that some of the issues we have mentioned will be ironed out in the near future.

However, for the time being we wouldn’t recommend small businesses buy and sell in crypto for now, at least not from an IT perspective.

Do you agree? Or, do you think we are missing the boat? Let us know in the comments below.

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