Many consider Bitcoin to be the future. It is a revolutionary invention that kicked off the cryptocurrency market and altered the global understanding of what money is.
If you own a business or are in the position to make financial decisions for one, now might be the right time to consider accepting Bitcoin as a payment method.
Some may take this route in the hopes of avoiding paying taxes on the payments they receive through Bitcoin, however, it is important to remember that regulations are already in place which require Bitcoin payments to be declared just like conventional payments.
Bitcoin is predominantly used online, so accepting it as payment for the products or services your company offers carries the potential to attract international customers that would normally use foreign currencies.
Allowing Bitcoin payments is a good way to increase your customer base. However, getting started may seem like a daunting task if you don’t have access to the right information.
To help you, we have created a comprehensive guide on how to start accepting Bitcoin payments.
Select a Bitcoin Payment Service Provider & Set up an Account
A Bitcoin payment service provider, or PSP, allows merchants and customers to sell and buy goods online using Bitcoin as a currency.
Many credible Bitcoin PSPs handle Bitcoin transactions online. By integrating Bitcoin payments through a reputable PSP, you can receive payments in Bitcoin and withdraw them in your local currency.
The first step you should take is to find a Bitcoin PSP that fits your needs. Coinbase and BitPay are the leading PSPs in the field. BitPay is the PSP for companies like Shopify, Gyft, and Newegg. Other common PSPs include PayStand and Paymium.
If your business’ site is based on WordPress, the majority of these PSPs will be easy to add using their WordPress plugins.
Once you choose the PSP you want to use, you will need to set up an account. The procedure to do so will likely differ depending on the PSP you choose, but it should be fairly simple.
Here’s the setup process for Coinbase, BitPay and Coinify:
To start accepting Bitcoin payments by using the Coinbase platform, you will first have to sign up on their commerce site. Once you enter your email address, the Coinbase team will send a verification email. After that, you’ll be directed to start creating your account.
The second step of the process requires two-step verification, where you’ll need to install Google Authenticator so that code will be shared with you to enter. The app can be installed on your phone or any other device you might be using, and it will complete the action in seconds.
The third step is to set up your wallet. To do this, you need a seed phrase that will be the key to your wallet. As soon as you choose Show my seed phrase, the platform will generate one for you.
Make sure you keep this seed phrase either on your computer or on a piece of paper (or both). Your seed phrase is very important, since losing your seed phrase means losing the crypto funds in your wallet.
Once you click on Okay, I’ve saved it securely, you will then be able to set up your crypto wallet. For this purpose, you will be required to type your seed phrase. Then you will have the option to back up your wallet.
From this point on, you’re ready to start accepting cryptocurrencies from your clients.
Going to your dashboard, you will be able to see all of the features. The left side of the screen you’ll see balances, payments, checkouts, point of sale, settings and a blue button that says Accept payments. By clicking on this button, you will have the option to either Sell a Product or Accept Donations.
At the center of the page, there are buttons for creating a checkout, integrating commerce and using Coinbase’s API. Depending on your own desires and needs for accepting Bitcoin, you will have to make a choice that best suits your requirements.
Since it’s designed precisely for Bitcoin payments, BitPay is one of the most effective platforms for this purpose.
The first thing you need to do is visit the BitPay website and choose to sign up for a business account.
Some of the data you enter here, such as your email address, will have to be verified. Once you confirm your email address, you will be two steps away from the ability to accept cryptocurrency.
The next thing you will have to do is verify your business. Here, you will have to enter the legal name of the business, the industry, phone number, website, information about the physical address of your business, as well as your personal information if you are the owner.
The third step is adding a bank account or cryptocurrency address in order to receive a settlement for the payments.
Coinify also makes it very simple for the businesses to start accepting Bitcoin payments.
When you enter Coinify’s website, you should go to the Signup button at the right corner of the screen, and choose Merchants. Enter your email address and a password. Then, by verifying your email, you will be required to log in again and enter your country of residence, your full name and date of birth.
Once you are in, you will have to complete your business profile. Here, you will be asked to enter details such as your business’ name, the logo, the physical address, mobile phone, and so on.
As soon as you are done, the next step is to verify your account. Then you will be able to reach the payment accounts and then the payment settings.
Bitcoin API Services
While the mentioned service providers and digital currency exchanges are a good option for integrating Bitcoin payments, they are not the only choice.
The Bitcoin APIs are among the services that make it extremely easy to start accepting Bitcoin payments. Unlike the majority of similar payment providers, the APIs process the payments in a way that eliminates the need for entrusting a third party with your crypto wallet.
Bitcoin API services also monitor the Bitcoin network specifically for the transactions that are sent to the address determined in your account. Currently, Bitcoin APIs have the ability to post amounts for changeable price transactions and price transactions that are fixed.
Regarding the integration part, the sellers that want to start accepting Bitcoin payments should generate a number of Bitcoin addresses and enter them into the account they already have. Simultaneous, the seller should place the addresses they have generated into their store.
Following, the software of the store itself has the ability to assign these addresses separately to each order or session. The order is completed for the customer once they send Bitcoins to the assigned address.
While all of this is happening, a confirmation from the Bitcoin API services is awaited by the back-end of the seller’s store. When the anticipated confirmation is received, the seller’s store has an option to either send the customer an email and let them know that the payment they made was accepted or display the product to the customer. For future use, the generated addresses that have already been used can be released again.
Choose a Currency
When you open an account with a PSP, you will be required to choose the currency to which your Bitcoin should be converted.
Keep in mind, each PSP may have different exchange rates and fees. Therefore, when selecting a PSP be sure to confirm these rates before making an account.
While on this topic, it is important to note that the majority of PSPs will recommend working with euros because this currency reduces the fees for each separate transaction.
With regard to your pricing, you are still able to charge your end customer in U.S. dollars but get paid in euros. A spot exchange rate will be used for the conversion from USD to EUR, and the rate of the exchange includes no commission fees.
Set a Price in Bitcoin
Out of all the steps you need to follow, this one is likely the most difficult. For many reasons, Bitcoin’s price is not steady. Due to this volatility, it is often challenging to set a constant price for the products or services that your business offers.
The most common thing merchants do is to decide on the price based on the current market rate. This means that the price you charge for your products or services is going to be variable, just like the price of Bitcoin.
However, to be able to put a Bitcoin price tag to anything you are selling you will have to calculate it first. In case you have no idea about how to do that, then you should simply let Google do the work for you.
Before you can actually calculate a specific currency in Bitcoin, you should first decide on the fiat currency you are converting. Let’s take the U.S. dollar as an example. If you want to know how much a particular amount of dollars is worth in Bitcoin you can do that by typing it on Google. For instance – How much is 50 dollars in Bitcoin.
Google’s Finance feature shows up in the search results with your answer. Depending on the current price of Bitcoin, the Google Finance calculator will show you an exact price.
That is basically one of the easiest ways to determine the price. In case you want to use another fiat currency to calculate its worth in Bitcoin, then you can change the currency on the calculator itself.
On this topic, we would also like to note that the best practice when receiving Bitcoin payments is to convert them to fiat currency—i.e., dollars or euros—right away.
While keeping your Bitcoin may be advantageous in the future, in order to cover your business costs and ensure that you do not lose money if the price of Bitcoin drops, the best thing to do is immediately convert the cryptocurrency.
Start Accepting Bitcoin Payments
Now that you have your account set up and understand what to do once you receive a payment in Bitcoin, you can begin accepting Bitcoin as a payment method.
You should take steps to inform your customers that you are now able to accept Bitcoin payments. Your regular customers likely use the same payment method for all of the purchases they make from your business. Therefore, they may not realize that you support Bitcoin payments unless you spread the word.
One of the simplest ways to do this is to send an email containing a payment link to your customers.
If your business is strictly web-based, you can make a banner for your online store and place it on the homepage. This way, each person who visits your website will know that you accept Bitcoin.
Alternatively, if you have a physical store, you can hang a “We Now Accept Bitcoin” sign at the entrance, for customers and passersby alike to see.
One of the easiest ways for the brick-and-mortar stores and small businesses to integrate Bitcoin payments is to start accepting them in-person. This simply can be done by creating a digital wallet of either of the service providers’ platforms and get the buyers to send the correct amount of BTC to your online wallet.
For this purpose, there are a number of smartphone apps available for both iOS and Android.
For the merchants that want to receive Bitcoin payments straightforwardly, there is an app called CoinBox that is perfectly designed for this.
Once you enter the price of the product that the customer wants to buy with Bitcoin, the app will immediately display a QR code that contains the price of the product or service and the address where the funds are sent. In order to pay, the customers will have to scan the QR code with their own digital wallet (app). This way, the payment will be completed quickly.
Integrate Bitcoin Payments on Your Website
If you have an e-commerce platform and you want to integrate Bitcoin payments, you must select a PSP that offers an API that can be integrated with the platform you use.
Both Coinbase and BitPay offer an API that allows for easy integration. The code samples with mock server testing come in Java, PHP, Perl, Ruby, and Python, among other languages.
With the Coinbase Commerce Payment Getaway for WooCommerce, you can start accepting Bitcoin in just a few minutes:
- The first thing you need to do is download and install the plugin from your WordPress admin page.
- Once the plugin is installed, activate it on your WordPress site.
- Then, sign up for Coinbase Commerce and follow the site’s instructions to help get you started.
- After this, you will want to link your Coinbase Commerce account with your WooCommerce store. Go to your admin area on WordPress and choose WooCommerce.
- Then go to the settings and choose the Payments.
- Here, click on the Manage button and configure the plugin to your store.
- Then, you will need to add an API key and create a Webhook subscription.
The process of integrating BitPay’s extension to your WordPress e-commerce site is equally simple as with the plugin of Coinbase.
- Before you start, make sure you have already installed the WP eCommerce plugin.
- Once you have that set up, sign up for a merchant account on BitPay.
- Further, download the plugin in its latest release and extract the zip file’s contents.
- Then, copy the folder of the wpsc-merchants folder and paste it to your WP eCommerce instance.
- To be able to connect BitPay with WP eCommerce, you need to log into your WordPress account and go to your admin panel.
- Enter your settings; choose Store and then Payments.
- Check the box that says Bitcoin Payments by BitPay. This is how you connect BitPay with your store, thereby activating the ability to pay with Bitcoin.
- Save the changes, and then click the settings in the same box.
- Edit the Display Name if you want and then in the BitPay merchant dashboard, you can create a pairing code. Copy this code and past it to the Pairing Code area in your admin dashboard on WordPress.
- This is how you create an API token for future BitPay transactions.
With your Bitcoin payment processor of choice, you can set up one-time payments, subscriptions, and donations on your platform.
Fees of the Services
The PSP will allow you to begin receiving and converting Bitcoin payments into bank withdrawals. Fees ranging 1-3% are generally standard for these actions.
For example, Coinbase does not charge its users for merchant processing. As said on their website, Coinbase Commerce is completely free, which means accepting cryptocurrencies with the Coinbase platform is free of charge.
BitPay, on the other hand, does charges a minor fee that helps to cover the cost of BitPay’s miner. This fee is the only fee that BitPay charges to the users of their service. BitPay charges a 1% fee for merchants processing. The merchants also are given the choice to pass this fee on to the buyer.
Like Coinbase, Coinify does not charge any payment-processing fee or sign up fees. However, if the merchant’s account currency is different from the currency for payment, the platform applies a small conversion margin.
Paymium also does not charge any withdrawal fees to their users.
To sum things up, Bitcoin is here to stay. Even though it is in a seemingly constant battle with traditional financial systems, this most dominant cryptocurrency appears to be changing the way we trade forever.
Fortunately, there are plenty of methods to accept Bitcoin as a payment method relatively easily. As awareness and usage of cryptocurrencies continue to grow, there is no time like the present to start accepting Bitcoin payments at your business.