Purposes, Risks, and Account Setup — Aspects of Cryptocurrency for Business

Digital assets are no longer just a playground for tech geeks and retail traders — institutional participation is ramping up, while the number of industries joining the crypto sector is growing.

Buying cryptocurrency as a company, whether for hedging purposes, long-term investments, or new tech-driven opportunities, is becoming a strategic decision for many. Today, we can see the growing number of professional-grade exchanges meeting the needs of companies buying crypto, for example, the WhiteBIT b2b crypto exchange. In this article, we’re going to discuss how to choose an appropriate platform and create a corporate cryptocurrency account. However, before we dive in, knowing the risks and hurdles as well as the best practices is a must.

Reasons to Buy Cryptocurrency as a Company

When a company adopts crypto, it’s not just about hype — there are plenty of reasons to use cryptocurrency for business purposes, for example:

• Using crypto for diversification. Digital asset investments often act as a unique hedge, for they move independently of stocks or fiat assets. While the traditional markets are all correlated, holding money in digital assets serves as a portfolio buffer for many companies.
• Hedging with cryptocurrency. Companies dealing with international payments may use digital assets to mitigate currency risks. While traditional local currencies may fluctuate, using stablecoins for business transactions provides protection against inflation and currency devaluation and ensures the real value of payments is preserved.
• Crypto revenue streams for businesses. Companies set up new revenue streams by investing in crypto projects, launching Web3 services, offering crypto-related solutions to their clients, or accepting crypto as a payment. Today, we observe the growing number of fintech companies integrating crypto as a service solutions, turning crypto into a core tool of their business.
• Cryptocurrency investment for companies. Bitcoin is often treated as a strategic long-term investment for companies that believe in the future of blockchain.

Volatility in Cryptocurrency and Other Considerations

Let’s be honest, most doubts around crypto boil down to its volatility. Bitcoin’s price may swing 5-10% in a day, making it a serious issue for a company with tight cash flow. See the risks associated with crypto investments:

• Price swings — volatility may cause portfolio drops of 30% in a week, so companies need to be prepared and conduct robust risk management.
• Security — beware of phishing attacks and hacks on wallets. Ensure cold storage for your company funds, as well as multi-sig protocols.
• Regulations that always change. The fact is that the rules around crypto custody, reporting, and taxation are evolving, so keep an eye on the regulations in the state you live in.

Tips on Choosing a Cryptocurrency Exchange

A reliable business-grade crypto exchange is a bedrock for companies willing to start buying crypto. A company that wants to enter the crypto space seriously will choose an institutional-grade platform with strong infrastructure and compliance tools, as well as business support bundled in. Here is what you should look for when choosing a cryptocurrency exchange for businesses:

1. Corporate integration. The platform should provide dedicated support for entities, KYC, and tax documentation tools.
2. Custody. The exchange must ensure robust security for client funds custody, the best option it they offer cold storage, as well as multi-user permissions.
3. Fees. The platform should have a transparent fee structure.
4. Liquidity. Without sufficient liquidity and order book depth, a company will not be able to conduct large trades.
5. Supported assets. The exchange must support digital assets that your business aims to use.

Popular exchanges known for b2b services are WhiteBIT, Kraken, Coinbase, and Binance. Before using the platform in full, start with a small deposit to see how it works.

Creating a Corporate Cryptocurrency Account

Cryptocurrency investment for companies starts with choosing an exchange, where the next step is to set up an account. This usually involves more documentation and review compared with individual registration on a trading platform. However, it’s all for the sake of your company’s safety. Here is what it takes to register a corporate cryptocurrency account:

1. Provide the company registration documents, certificates, articles of association, etc.
2. Proof of address — utility bill statement or other document to prove the company’s address.
3. Tax ID.
4. Identity verification for authorized signatories, like proof of position.
5. Bank accounts in the firm’s name.

During the onboarding process, your company will have to provide these documents; some may also ask for a business description. Once approved, the company can deposit funds from external wallets to the exchange wallet and start trading or holding crypto. Deposits are available by wire, debit, and credit cards.

If your company operates at scale, it is appropriate to assign the roles — who manages wallets, who approves transactions, and how your funds are tracked. This would enable different access levels for team members and reduce the risks of unauthorised transactions.

Buying cryptocurrency as a company is not just about trend-chasing — it is positioning your business for development, innovation, and investments. However, this move for your company comes with risks and challenges — crypto volatility, taxes, regulations — these must be treated with care. The good news is that a partnership with the right crypto exchanges and services helps your company go through the integration process much more easily, helping at every step. Thus, you turn crypto from an experiment for your business into a competitive advantage and positioning for success.