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Cryptocurrencies continue to gain broader traction and acceptance across all demographics. Most importantly, Wall Street is constantly trying to expand its activities in the field of digital currencies and blockchain.
Goldman Sachs announced that it will offer Bitcoin-backed loans, while Fidelity launched a virtual Bitcoin ETF in Canada last December. The investment firm is also eager to launch a Bitcoin fund in the US, but is awaiting legislative approval. The potential for starting a blockchain business is virtually limitless. Cryptocurrencies and the technology they work with have been around for just over 12 years now, and the industry is still in its infancy.
As the founder of a cryptocurrency investment firm IRA, I have seen for myself what it feels like to be an entrepreneur in this exciting space. And I know you can do that too. you do not believe me ? Let’s look at four basic ideas for starting a business in the world of cryptocurrency.
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Crypto tax advice
You may already own a tax advisory firm or work as a tax advisor. In this case, you will enter the cryptocurrency space to pick up a new line of business. However, you can also start a cryptocurrency tax advisory from scratch.
Buying and selling cryptocurrency creates an event that can be reported to the IRS. Many traders and investors make hundreds or thousands of trades per month. Keeping track of the amount gained or lost from each transaction and completing the necessary paperwork can be a real problem.
Automating the process would relax the trader and prove highly profitable. An example is BearTax, which is connected to almost any crypto exchange and creates a file with all the necessary information. The document can then be sent to an accountant or it can be imported into a tax filing program.
Create your own digital widget
Creating your own digital widget is easier than it sounds. Many cryptocurrencies are, by their nature, open source – and one of their greatest values is decentralization. Digital currencies are created and operated on a network of nodes that produce coins and record all transactions.
This technology, known as blockchain, is probably the hardest part of the puzzle. For this to work securely, you’ll need a lot of nodes. Each node is a computer that works independently, after which you will need to create an algorithm that supports the blockchain.
Creating your own blockchain will allow you to define all the parameters of your digital currency. You can adjust the initial size, the maximum final total size and the difficulty of extracting the part, among others. However, you also have another option, which is to use the blockchain for an existing digital currency. You can use a turnkey creation service like Cryptolife. This allows you to focus on the parts themselves and their properties.
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Those looking for a large-scale project may want to consider starting a cryptocurrency exchange. Exchanges allow people to buy and sell digital currencies, often hundreds of different coins. The exchange charges a fee for every transaction, deposit, withdrawal, and transfer.
There are actually several types of exchanges out there, so you’ll need to do some research to determine which option is best for you. Or you can find a new solution and solve unresolved problems. Here are some examples of exchanges:
white label exchange
Book exchange arrangement
The primary tools you will need to make this venture a success are your exchange software provider and payment processor. This type of startup is also very capital intensive, so you may need to raise capital to go over all the steps needed to end up with a final product to launch.
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Even though cryptocurrencies are starting to gain traction with retailers, we are still far from the mainstream acceptance of digital currencies to buy whatever you want. Many cryptocurrency users want to use digital currencies in their daily purchases.
You can start an e-commerce business that accepts cryptocurrency and use dropshipping to avoid dealing with storage and delivery. You need to set up your own e-commerce site or join the services of a company like Shopify.
Then you need an exchange to facilitate transactions. Coinbase Commerce already does this, making the process incredibly easy for online merchants. Coinbase Commerce is already integrated with Shopify, and you can also access dropshipping services through Shopify.
There are no merchant fees for accepting cryptocurrency payments. However, you will be charged transaction fees for converting your cryptocurrency into fiat currency. Unless you are a crypto player, you may need to trade cryptocurrencies for fiat regularly to avoid the risk of buying cryptocurrencies.
Decentralized finance is still in its infancy and there is still a long way to go for cryptocurrencies to gain widespread acceptance. But as with all groundbreaking moments, the fact that there is still so much uncharted territory presents an even greater opportunity. I took this opportunity five years ago, and I hope you feel inspired to share as the market matures.