Cryptocurrencies are here to stay. There are now investment funds buying them and trading them, instead of just tech gurus playing with the technology. You can now invest in them through dozens of investing platforms while many websites are starting to accept payment in Bitcoin and other cryptocurrencies. Here is the information you need on how to start a successful business in cryptocurrencies.
Understand Your Objectives
Have a business plan on how you’ll make money via cryptocurrencies. If you are offering services, you may be able to tap into markets you couldn’t reach otherwise. If you’re going to mine cryptocurrencies, consider the cost-benefit analysis. How much does power cost? How much do the hard-drives you’re going to use to mine cost? And what would you get for each crypto-coin you get?
If you’re planning on trading in cryptocurrencies in the same way you’re day-trading stocks or on a foreign currency exchange, do your research on how you could actually profit from it. Don’t jump in to trade cryptocurrencies against each other or against government-backed currencies and hope to make money from the cryptocurrency boom.
Engage Experts Before Problems Arise
You certainly need the technological experts if you’re concerned about long-term use and storage of cryptocurrencies. The “forking” of cryptocurrencies, when it is a hard fork, creates one new currency as well as the old one. If you don’t have a plan in place and the right setup, you could end up still holding the upgraded cryptocurrency but none of the forked, new currency that also holds value.
You also need to pay attention to IT security. Furthermore, you need to engage experts as you change your website, alter your IT infrastructure, move services to the cloud or update your services. Before you send notices to technical experts when you have concerns, verify contact emails with a service like theemailfinder.co and build a list of contacts that you know will receive your message.
Pay Attention to the Legal Environment
Cryptocurrencies have been gaining legitimacy worldwide. However, legal decisions and new laws abound. You will need to report payments in cryptocurrency to your business as income. You also have to know which cryptocurrencies you’re allowed to accept, how you are supposed to report international sales to someone in another country paying with cryptocurrency, and the legal treatment of profits from cryptocurrency trading.
Investing in ICOs
ICOs, or initial coin offerings, are one of the most lucrative opportunities in the crypto space, but they can also be tricky. If you’re hoping to take advantage of ICOs or initial coin offerings, you’ll still need to buy another currency that the ICO organizer accepts. This is typically Bitcoin or Ethereum. In this particular case, you’re hoping to profit from the new alt-coin going up in value as it goes up. You’ll want to research how to get into pre-sales before a public ICO, when you’re likely to secure the new cryptocurrency at a low price before the public demand pushes it up.
Starting a business in the crypto isn’t easy, but it can be done if you know how to go about it. These few tips should help you get your foot in the door and slowly establish yourself in this space.