New York allows you to accept cryptocurrency if you have a BitLicense, which costs $5,000 to acquire. You should be aware of the pros and cons of accepting cryptocurrency as startup funding before making your decision.
No third-party processor
Investors don’t need to go through a third-party processor to send your cryptocurrency. This can save both of you money on the capital-raising process. When investors send you cryptocurrency directly, there isn’t a fee. They send it from their wallet to yours, and the cryptocurrency appears immediately or near immediately in your wallet.
Could increase in value
If you hold onto some of the cryptocurrency for a while before spending it, the value may increase. However, the opposite is also true. Its value could decrease over time, especially if it’s an altcoin.
Taxes on holding
You might have to pay taxes on any increase in the value of your cryptocurrency. It’s best to check with a professional to clearly know what tax implications may apply to your situation.
You need a hard wallet
If you choose to accept cryptocurrency for startup funding, you’ll want to use a hard wallet for extra security. A hard wallet requires that you push a button on the device to spend your cryptocurrency. This helps protect your wallet from hackers. It’s difficult to impossible to get stolen cryptocurrency back.
Some people prefer using cryptocurrency
One of the benefits of accepting cryptocurrency as an investment is those who are passionate about this form of currency choose to support businesses that are friendly toward it. You open yourself up to more funding opportunities and customers by accepting cryptocurrency as funding and payments.
Only you can decide whether it makes sense in your situation to accept cryptocurrency for your startup funding. There are pros and cons, so it comes down to your comfort level with the option.
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