Bitcoin is often discussed as an investment held by individuals, but its potential role extends beyond personal portfolios.
For businesses, Bitcoin can be used in several ways — from holding it as a treasury asset to accepting payments and transferring value internationally. The right approach depends on the organisation, its objectives and its appetite for risk.
Here are some of the ways businesses are beginning to incorporate Bitcoin into their operations.
Hold Bitcoin as a Treasury Asset
One of the most straightforward approaches is holding Bitcoin on a company balance sheet.
Instead of keeping all surplus capital in cash or traditional assets, a business may choose to allocate a portion of its treasury to Bitcoin as a long-term holding.
The reasoning varies between businesses. Some are attracted to Bitcoin’s fixed supply of 21 million. Others view it as a way to diversify their treasury or gain exposure to an asset that operates independently of the traditional banking system.
Bitcoin’s price can be highly volatile, however, so treasury allocation requires careful consideration of cash flow requirements, time horizon, accounting and tax implications.
Accept Bitcoin Payments
Businesses can also accept Bitcoin as payment for products or services.
Depending on how the payment system is structured, a business may choose to retain the Bitcoin it receives or convert some or all of it into Australian dollars.
Bitcoin’s Lightning Network can also enable fast, low-cost Bitcoin transactions, making smaller payments more practical than transactions conducted directly on Bitcoin’s base layer in some circumstances.
For businesses with international customers, Bitcoin may provide another way to receive value without relying entirely on conventional international payment networks.
Pay Suppliers and Contractors
Bitcoin can also be used to make payments.
Where both parties agree, businesses can use Bitcoin to pay suppliers, contractors or service providers locally or internationally.
This can be particularly useful when organisations operate across borders. Bitcoin can be transferred directly between participants without requiring transactions to move through multiple correspondent banks or payment providers.
That doesn’t remove the need for proper invoicing, record keeping, tax treatment and compliance. Bitcoin transactions should still form part of the business’s normal financial controls.
Build Bitcoin Into Employee Benefits
Some businesses choose to offer employees or contractors the option of receiving a portion of their remuneration in Bitcoin, where legally and operationally appropriate.
This doesn’t necessarily mean replacing conventional payroll.
Instead, Bitcoin can potentially form part of a broader remuneration or benefits strategy for people who actively want exposure to it.
Businesses considering this approach should obtain appropriate advice about payroll, superannuation, taxation and employment obligations before implementation.
Secure Bitcoin Properly
For a business, buying Bitcoin may actually be the easy part.
Securing it is where the strategy becomes more important.
A company holding Bitcoin needs to determine who can access it, how transactions are authorised and what happens if a key person leaves the business or becomes unavailable.
Rather than relying on one person holding a single private key, businesses can implement more sophisticated custody structures such as hardware wallets, cold storage and multi-signature arrangements.
A well-designed system can establish clear controls around who can move Bitcoin and under what circumstances.
Start With a Strategy
Using Bitcoin in a business doesn’t need to mean changing the way the entire organisation operates.
It may begin with accepting Bitcoin from one customer, making a small treasury allocation or simply developing a custody plan so the business understands how Bitcoin could be held securely.
The important part is understanding why your business wants to use Bitcoin before deciding how to implement it.
At Bitcoin Hawk, we help businesses understand Bitcoin, develop practical strategies for acquiring and using it, and implement custody structures designed to protect it for the long term.
