Bitcoin (BTC) and other cryptocurrencies have been expanding all over the world and companies would like to get access to them. However, the cryptocurrency market has been built for retail investors rather than for corporations. This could be one of the reasons why companies are lagging behind in terms of Bitcoin adoption. Access to Bitcoin for companies is something that we should carefully analyse and understand.
However, there are some ways in which firms could get access to Bitcoin for companies. Of course, holding small amounts of virtual currencies is not a problem. However, when it comes to holding large amounts of money (over $25,000) it becomes very important to know how to do so. In this guide, we are going to share with you all the information you should know about Bitcoin for companies.
Bitcoin for Companies
The cryptocurrency market has reached a large number of users and individuals around the world. Millions of retail investors have purchased Bitcoin and other virtual currencies, but small, medium and large companies are being left behind this trend.
There are different reasons behind this situation. Getting access to Bitcoin for companies has been usually more difficult than for retail investors. One of the main concerns is related to security standards (we will get into the details later in this post). It is usually not convenient for large companies to keep custody of Bitcoin.
As we already know, using a cryptocurrency exchange and storing our funds there is not the best option. Indeed, there are different risks of leaving Bitcoin on a cryptocurrency exchange. Bitcoin for companies requires firms to make sure that they are protecting their funds against attacks or hacks from third parties.
This is where using an experienced broker and company becomes a key thing. Firms do not want to keep custody of their Bitcoins, they want someone to do it for them. This is why there are some companies that are offering brokerage and custody services. This is one of the easiest ways to get Bitcoin for companies.
Another thing that is worth taking into consideration about Bitcoin for companies is related to regulations. It is not easy for companies to handle Bitcoin in an unregulated market. This is why it would be very important for them to find brokers and service providers that are currently operating with the necessary licenses and comply with all the regulations.
How to buy Bitcoin as a Company?
Buying Bitcoin as a company could be a difficult thing. At the moment, there are some cryptocurrency exchanges that are offering corporate services to firms. This would let companies open an account at a cryptocurrency exchange and buy Bitcoin.
Although this could be a great way to buy BTC, it might not be ideal. Getting access to Bitcoin for companies is something that requires knowledge and experience managing and handling digital currencies. Despite the fact that a company wants to get exposure to Bitcoin, it does not mean that they have the time and knowledge to make sure that they follow all the security standards.
Holding cryptocurrencies at a crypto exchange is dangerous. Exchanges get hacked and they could experience different types of failures. This is why it is important to make sure that the Bitcoin that a company bought is stored in a cold storage device following the necessary security procedures to avoid possible problems.
This is something that can be done using crypto custodians or cryptocurrency brokers that would protect your funds at all times. This would reduce possible problems that could arise from a company’s own custody of their Bitcoins.
Let’s not forget that keeping custody of Bitcoin is not an easy thing to do. This is why getting access to Bitcoin for companies requires knowledge and expertise on that matter. This is where it would be very important to find the correct companies that would offer investors the possibility to handle their funds without being worried about attacks, hacks or other types of problems.
What to Take into Consideration when Buying Bitcoin?
When buying Bitcoin as a company there are some things that are worth taking into consideration. Bitcoin is a relatively new asset class that has been expanding over the last decade. Companies have been purchasing Bitcoin for some years, but there are some things that are worth taking into consideration.
Security Standards (Bitcoin Custody)
When it comes to Bitcoin custody for companies, it is certainly necessary to know that the funds are properly stored. Using an exchange as a company could be somehow risky, this is why brokers and companies that offer Bitcoin custody services are the best options available.
These custodians would make sure that all the security standards are met. That includes the use of hardware wallets and additional security for customers that want to protect large sums of Bitcoin and other virtual currencies.
For example, one of the ways to protect cryptocurrencies is by using hardware wallets that are not connected to the internet. These hardware wallets are very important for those investors that handle large amounts of virtual currencies. The larger the number of BTC held, the more necessary it becomes.
This is something that specialized custodians are able to offer. Despite the fact that exchanges claim that they keep users’ funds on cold storage, this might not necessarily be the case. Additionally, some companies have already been working with insurance firms that make it possible for funds to be protected in case of a hack or attack.
Understanding how Bitcoin custodians offer solutions to clients is very important. In the long term, these custodians would be able to onboard new clients and users that would like to buy and handle virtual currencies in a compliant way. If you want to buy Bitcoin as a company, then a crypto custodian is going to be a key partner of your business in the long term.
In recent years, companies have been following market standards in order to offer some of the best cryptocurrency custody solutions. Despite that, it is not easy to find jurisdictions with defined rules for custodians. This is why it is quite important to make sure that companies follow market standards in terms of security.
It is also very important to take into consideration the regulations that apply to companies around the world on how to handle cryptocurrencies. It is extremely necessary for companies to be compliant with all the regulations that apply to them in order to handle virtual currencies.
Some countries and jurisdictions might require companies to use the services offered by cryptocurrency custody companies. There are several companies offering custody for Bitcoin. However, not all of them have been regulated.
Indeed, custody services should also be regulated. Due to the lack of clear regulations for virtual currencies, it might be difficult to find a reliable custodian for your cryptocurrencies. Hence, regulations would not only apply to the company that purchases virtual currencies but also to custodians offering crypto storage solutions.
The best thing for companies that want to buy Bitcoin is to search for licensed companies that are operating under local regulations and that are compliant with all the necessary standards to handle virtual currencies. This is extremely important. If there is an issue with your funds, you can get the necessary help from local regulatory agencies.
Those that want to get access to Bitcoin for corporations require contracts. That means that those service providers that are not able to sign a contract with the company would not be able to deal in a compliant way with all the regulations and necessary security standards.
Management fees are also very important for companies that would like to get services from cryptocurrency custodians. Indeed, every single custodian has different fees that range between 0.4% and as much as 1.2% for just holding your virtual currencies. There could be other companies with lower fees.
As a company, if you want to buy Bitcoin through a broker, they may charge fees that range between 2.5% and 8% depending on the volume and cryptocurrencies you handle. This fee should be added to the custody fee.
Companies that purchase Bitcoin through a licensed broker have many advantages. They do not need to be worried about opening and managing accounts at a cryptocurrency exchange. Brokers are going to be handling all the paperwork and transactions for your firm. This applies to small, medium and large companies. Brokers will make sure they handle Bitcoin and other virtual currencies using the best exchanges. Moreover, brokers can also offer custody services, which means that you will not have to be worried about the way in which you store your funds.
Brokers that offer custody services at the same time might be the best option available in the market right now. These firms make sure that you get the best possible purchasing price for Bitcoin and other virtual currencies and that your funds would be properly stored.
Take into consideration that this management fee is currently paying for the hardware infrastructure needed to store virtual currencies, for the management of your account, for paying possible transaction fees and for making sure that your funds are protected at all times. Some brokers would also offer you the possibility to contact them on a daily basis and get exclusive information from them.
Services Offered by Custodians
Custodians have been expanding all over the world over the last few years. Thanks to the expansion of virtual currencies, custodians have also been offering different types of services and solutions to their clients besides custody.
One of the main services offered by custodians is the possibility for clients to use an API to get access to all their information and account. However, this is only possible through those platforms that work as a custody service only. In some cases, brokers would not offer API management.
Handling Bitcoin for corporations requires companies to be sure about the solutions they are offering. For example, in some cases, investors might prefer to hold virtual currencies that could be staked on different online platforms. These funds that are staked would offer investors the possibility to earn rewards through custodians.
However, this is not the most traditional service offered by custodians. Basically, custodians would only focus on holding and protecting your coins in a secure way. Other custodians might offer you the possibility to buy and sell virtual currency through an agent that would work as an intermediary for your company.
Brokers and custodians can also work together. In some cases, a custodian company might also offer brokerage services. In some other cases, a broker company could also offer custody services to investors. This is why it is up to you to decide the type of solution you need when handling virtual currencies.
Some companies might be even able to offer clients the possibility to acquire different digital currencies. While focusing on Bitcoin, other brokers and custodians might be able to let you buy Ethereum (ETH), Litecoin (LTC), Binance Coin (BNB) and many other virtual currencies according to your needs.
Conclusion on Bitcoin for Companies
Bitcoin is now one of the largest assets in the world, but companies do not usually know how to get access to virtual currencies, as it becomes highly difficult for them to buy, store and sell Bitcoin and other digital assets. This is why brokers and custody companies are making it easier for corporations to buy Bitcoin.
As we have seen in this article, there are different things that are worth taking into consideration about managing digital assets. We talk about security standards, regulations, services offered and commissions. These things would define the whole business of custodians and brokers that let firms buy and handle Bitcoin.
In the future, it might be possible for different cryptocurrency companies to offer an even larger range of services related to Bitcoin and cryptocurrency storage. The important thing to take into consideration is that companies that want to buy Bitcoin can do so right now using brokers and custody services, online and in just a few simple steps.