Throughout history humans have used a number of things as currency. Gold, glass beads, animal pelts, salt – if something has value it counts as currency.
In our digital age it’s no surprise new forms of currency are virtual rather than tangible. Digital currency provides a way to make transactions online without the use of a bank. Instead of doing transactions through a middle man (bank) digital currency is exchanged more like the real thing and stored in a digital wallet.
Bitcoin is by far the most widely adopted form of digital currency. It was developed in 2009 to allow for person-to-person anonymous transfers without any fees. Bitcoins can also be used to make purchases online, and they’re beginning to make their way into the real world.
A new type of currency, means new ways of making purchases and payments, which means new business opportunities. Here are some of the most promising bitcoin businesses for 2017.
Bitcoin Mining Services
Just as man has mined for gold, silver and jewels we also “mine” for bitcoins. But instead of using picks and bulldozers, bitcoins are mined (created) by using encryption techniques and solving complex math problems with a super computer. Miners are rewarded with bitcoins of their own, which is a viable microbusiness for some entrepreneurs.
If you don’t have the startup capital for servers you can still try your hand at bitcoin mining with a platform like Genesis Mining. They provide people with the tools to start mining bitcoins through the cloud.
If you don’t mine bitcoins or receive them as payment from others you have to purchase them on an exchange. Bitcoin exchanges accept monetary payment for bitcoins that are transferred to a digital wallet. It’s kind of like exchanging currency at an international airport. The exchange will charge a small fee for making the swap.
You don’t have to be a massive finance operation to start an exchange. Entrepreneurs are setting up sites for local bitcoin exchanges in their area.
Bitcoin Brokerage Firms
Like many other forms of currency, there are professionals who can help you with bitcoin investing. Bitcoins can be bought, sold, exchanged and gifted just like stocks, bonds or cash. They are also going to be limited in number, which means there’s potential for them to increase in value. A bitcoin broker will do the work of buying and selling bitcoins for you in the hopes of making deals that grow your investment.
Bitcoin Vending Machines
When there are vending machines with salads, you know the possibilities are endless. It should come as no surprise that there are vending machines that accept bitcoin for payment. Bitcoin may be digital now, but there are opportunities for offline business that make and use vending machines that accept bitcoin payment. Given that you just need one piece of equipment the startup cost for a bitcoin vending machine business would be minimal.
The more widely bitcoins are adopted the more apps there will be for using them. Tech startups can make an entire business focusing on this growing app niche.
Bitcoin Payment Processors
If nothing else entrepreneurs, freelancers and businesses of all sizes can leverage bitcoins by accepting them as payment. As of 2015 over 100,000 businesses accepted bitcoins. Many did so through a bitcoin payment processor.
Bitcoin payment processors provide businesses with a digital wallet, tools and additional safeguards that protect the digital currency. BitPay is one such processor that also allows businesses to transfer their bitcoin payments onto a card that can be used in-person or get direct deposits into a bank account. For their tools and services, Bitcoin payment processors usually charge a modest 1% fee. This is much lower than the 3% charged by credit cards and 2.9% charged by PayPal.
One of the necessities for using bitcoins is having a secure digital wallet for storing them. Companies are now creating both digital and hardware solutions for bitcoin wallets. There are two reasons this can be a very lucrative business opportunity. For starters hackers can steal bitcoins out of digital wallets if they aren’t properly secured. Second, bitcoins aren’t regulated by the FDIC. If a theft happens the government won’t step in to help. Other businesses and consumers are willing to pony up for a bitcoin wallet that promises security.