Small businesses are the foundation of the American economy. Today, more than 50% of employees are employed in companies with less than 500 employees. These companies also provide 66% of new jobs.
Despite their importance, small businesses face many hurdles to online cryptosoft commerce
The Bitcoin has the potential to relieve companies of this burden. However, this requires a stable basis of trust and intelligent regulation. Entrepreneurs who want to start a new cryptosoft company today have access to many platforms to turn their vision into reality. Flextronics, for example, accelerates product development by helping cryptosoft companies optimize and manage their supply chain. Once created, companies can easily market their products on Amazon and leverage their server resources effectively depending on demand.
Thanks to Facebook, Twitter and Co., winning new customers today is also quite easy. These companies offer many tools to find potential customers. Once the customer has been found and a purchase is made, FedEx, DHL and UPS offer complete logistical services and timely delivery.
Even though small companies have had access to these platforms for years, they miss one essential area: payment. The current infrastructure of payment systems is poorly suited for online trading, which is becoming more and more central.
Everyday issues such as fraud and identity theft are a particular problem for small businesses with limited financial resources. Credit card refunds make sense in direct, local commerce. In the globalized consumer goods market, however, this policy is very laborious. Compared to large companies, small companies simply do not have the resources to accept online payments on a global scale.
As discussed during last week’s CoinSummit, we now have a whole new infrastructure with Bitcoin. Together with other platforms, the Bitcoin offers exactly the leverage that allows small businesses to stay competitive.
This reverse “Economy of Unscale” means that entrepreneurs from San Francisco to Mumbai can now grow rapidly with just a handful of employees and a dream of the future.
Since the beginning of industrialization some 200 years ago, the masses have been the key to a profitable large company. These companies have, to their advantage, created unfair trading systems that have given them more and more power.
Large enterprises also have the opportunity to spread the cost of business processes and inefficiency across a large sales volume. Entire business lines, from manufacturing to high quality services, could only be created close to monopoly conditions. Unfortunately, innovation often falls by the wayside.
The world economy is on the threshold of transformation
In order to reach the “promised land”, Bitcoin founders are now considering completely different approaches than in the past, when the creation of crypto currencies was the focus.
Unlike our carefree approach to online services, Bitcoin entrepreneurs must actively engage with regulators to ensure that consumers (and businesses) are properly protected.
The Bitcoin raises a host of questions that need to be answered in order to reach the masses. Consumers must be given the opportunity to keep their wallets safe and the Bitcoin market itself needs more stability. As Bitcoin transactions cannot be undone, companies need to find solutions for e.g. refunds.
Regulatory authorities are generally not against change, but are often understandably concerned about unknown technologies. Only through cooperation between government, financial institutions and technology can we ensure that we build a system that satisfies all interests.
This is why General Catalyst invested in Circle in an A financing round. Circle is working on an infrastructure around the Bitcoin to make it safer in daily use. Co-founder Jeremy Allaire, who has also worked in the app-ser area for several years.