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How To Accept Direct Crypto Payments

21 April 2020 | 13 comments | Posted by Che Kohler in Money Talks

How to accept crypto payments without custodial services

Cryptocurrency is starting to make its way into eCommerce and disrupting payment gateway services with a brand new method of transacting digitally. The blockchain offers instant payment settlement and more oversight into transaction data without needing additional tools to manage these payment gateways or having to pay fees.

The tokens themselves may still be volatile and make being a medium of exchange a little complex. Still, the underlying technology behind blockchain has sound fundamental principles that will eventually lead to more payment services using these protocols.

There are several cryptocurrency payment gateways currently available and looking to cement their place in this new niche, providing liquidity for businesses and providing administrative services. These payment gateways are an excellent onramp for those not wanting to deal with the technical issues of accepting cryptocurrency but to does not adhere to the essence of blockchain technology.

Becoming an independent payment gateway

Distributed ledger technology was designed to cut out the middleman and remove custodial services from the payment process so that customer and businesses could interact directly. Education is critical in this industry and what many business owners do not understand is that they can act as their own payment provider with some basic technology and finance housekeeping.

All you would need is a hot wallet, a cold storage device and a few spreadsheets and you're effectively running your own payment gateway that can accept a multitude of currencies instantly.

What you need to start accepting cryptocurrency

Accepting cryptocurrency for your goods and services is as simple as downloading an application known as a wallet on your Smartphone or Desktop, saving your private keys somewhere safe, so no one else has access to your wallets. You then need to set up public addresses for every cryptocurrency you want to accept as payment.

Hot wallets

I would recommend a hot wallet and keeping some working capital and for day to day purchases, accepting of payment, and issuing your refunds. Think of this as the active bank account you want to use each day for operational costs.

Cold Storage

Cold storage is for the cryptocurrency you want to take offline and store on a physical drive such as a Trezor wallet or Ledger Nano.

Since your hot wallet keys are public, any user can see how many funds are sitting in these wallets, so its best to keep your savings offline. Think of this as a secure account that you can only access for emergency funds. You should also take good care in your cold storage by having multiple copies and storing these devices either with a third party or somewhere safe.

You can migrate your funds from your hot wallet to a cold storage device at the end of every day, week or month depending on the amount you feel comfortable with running as operating costs.

Coins you can accept

The coins you accept all depends on you and on the communities you want to attract and support or the coins you find valuable. You can receive a range of coins or have currencies converted to coins you prefer once you've accepted the payment.

Accepting stable coins

The simplest form of accepting cryptocurrency would be to have stable coin wallet support for the various pegged and algorithmically created sable coins currently available. These coins are matched to the value of fiat currency of a particular country like the US Dollar or Euro and make it easy to accept digital payments without worrying about price fluctuations.

Converting to stable coins

This step is up to you if you're comfortable for example keeping your money in Bitcoin and you're not too worried about price volatility that's up to you and accepts payment based on the spot price of the day. For those who want to safeguard against pricing changes, they can convert their Bitcoin or Eterheum paid for goods and services and exchange it into a stable coin.

Keeping track of payments

The accounting of payments is the make or break here, and you'll need to have your wits about you if you want to start accepting direct cryptocurrency payments. You will need to keep a separate sheet handy for each of the currencies you received.

  • The currency you accepted
  • The spot price you took at the time
  • The value of the sale
  • If you converted the crypto into a stable coin
  • If sold it for fiat
  • The transaction ID (TX ID) for proof of the transaction living "on-chain".
  • The businesses public wallet key
  • The customer's public wallet key sending the transaction


You should also provide your customer with an invoice with the TX ID and even a link to the block explorer. That way, you both have a record of the payments settlement.

Tax implications

Depending on the region you're in, you'll have to review your tax obligations for receiving or keeping cryptocurrency long term. In some parts of the world, cryptocurrency can still be traded tax-free while others may require you to pay income tax or if you've kept it in a particular asset class or a more extended period you may need to pay capital gains tax.

Accepting more payment methods

As the world of private money continues to expand, the more you have a chance of leveraging new technologies and accessing new opportunities. You could reach new markets or customers you would have otherwise overlooked you as a service provider or even become a niche provider as other businesses fail to innovate as fast as you do.

It's essential for business owners of all sizes to stay up to date with opportunities to trade and conduct business. Cryptocurrency is still in its infancy, which means those that are early adopters will not only grab a larger market share but also learn valuable lessons that will provide them with a unique competitive advantage.

Keeping transactions on chain

Have you started accepting cryptocurrency payments? Have you done it directly or through a third-party service? How has it worked out for you? Let us know in the comments section down below.

Contact us

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If you require a more detailed guide on how to create your profile or your listing, then we highly recommend you check out the following articles. 

Recommended reading

If you enjoyed this post and have a little extra time to dive deeper down the rabbit hole, why not check out the following posts on cryptocurrency and blockchain.

Disclaimer: This article should not be taken as, and is not intended to provide any investment advice and is for educational purposes only. As of the time posting the writers may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency as all investments contain risk.

Tags: Cryptocurrency , Blockchain

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