One of the most amazing things about blockchain and something that should be understood, is blockchain is not just for the “big end” of town. In fact the work we do and the work done by our official partners: AR LAW SERVICES: Immigration & Regulatory Lawyers, is mainly to do is with individuals and small to medium sized businesses.
Given that, I thought I would write a piece specifically pointing out “concrete”, real and practical applications of blockchain for small business.
Power of smart/dumb contracts and the leverage they bring
Businesses can use blockchain for smart contracts, which are basically self-verifying, self-enforcing contracts. Stored within a blockchain ledger, the contract is recorded in a way that cannot be changed or manipulated. Smart contract examples include commercial leases, agreements with vendors or suppliers and even employee contracts. Smart contracts offer small businesses a level of protection it would otherwise never be able to afford. The middleman — usually an attorney — would not be needed in a smart contract, and as such, a business would have lower costs.
Global blockchain platform Ethereum was the first to introduce smart contracts to the cryptocommunity, and is considered one of the more advanced platforms for coding and processing of smart contracts.
New way to get paid – ditch the middle man!
An easy first step a business can do to adopt blockchain technology is to simply accept cryptocurrency as a method of payment. What signals more of a commitment to blockchain than allowing customers to pay with bitcoin or other cryptocurrencies?
The rollout will require a lot of planning and testing, as traditional merchant services are not set up to accept bitcoin. As such, a small business will need to evaluate and spend money on a digital wallet, a merchant gateway or a combination of services needed to accept the cryptocurrency from customers.
There are a few benefits for organizations when they accept blockchain currencies. As a gesture, customers can see this form of payment as a willingness to expand your services. Cryptocurrencies also allow businesses to directly deal with the customer, which reduces transaction costs. Another big advantage of the blockchain is that payments are permanent and irreversible, leaving the customer with no choice but to contact the business directly if they want a refund. This helps address the issue of chargebacks, in which customers purchase a product but then cancel the payment with the credit card company, leaving the business on the hook.
Capital raising – can’t make the scene if you don’t got the green!
Of the clients who contact me, raising funds is one of the main issues they wish to discuss. Blockchain technology provides business owners with an alternative method to raising capital through Initial Token Offerings (ITOs). As an alternative to the use of traditional banks, lenders, private equity firms and even crowdfunding sites, ITOs are tokens available for exchanges where they can trade freely. These tokens are comparable to equity or a revenue share in a typical company.
Interested investors can buy into the offering and receive new blockchain-based tokens from the company. This token may have some utility in using the product or service the company is offering, or it may just represent a stake in the company or project.
NFT – Non-fungible Token
Given my background in Music and the many “creatives” I know, the NFT space is also an area that presents many opportunities for individuals, small and medium businesses.
So if you have a business idea, get in touch and let us tell you how you can leverage the power of blockchain technology.
For all legal issues visit our official partner AR LAW SERVICES: Immigration & Regulatory Lawyers
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