If you own a crypto business or look forward to starting one, you’re on the right path.
At the initial stage, it may seem challenging to scale. However, know that’s typical of any business model.
As a crypto business owner, it’s important to always play the long-term game. That way, the potential for profits is high.
For instance, a typical crypto business can generate huge revenues through transaction fees. You’d be amazed at how profitable you’d be.
In recent times, lots of crypto businesses have been on the rise.
The entry-level into the industry is relatively low, meaning you can get your business running with little capital. That’s a massive potential for growth.
Despite the advantages of owning a crypto business, it could be hard to start one without putting the proper structure in place.
There are several regulatory hurdles to cross, and the company must implement suitable systems to succeed. You don’t want to be caught in that web.
Is Structure All That Important For Your Crypto Business
Depending on the crypto business you consider, whether an STO, a trading exchange, ICO, a cryptocurrency fund, or even a crypto platform where investors get access to buy different cryptocurrencies, and are also opportune to pay via different payment methods.
For instance, a buy SOL with a credit card prompt on your crypto purchase website will attract investors who wish to buy the coin but do not have enough money to do that.
Putting a proper structure in place for your business empowers you to carry out the business smoothly without regulatory hitches.
As a crypto business owner, you should be aware that the cryptocurrency space will continue to experience different levels of regulations and government oversight because tokenizing assets is a trend that is here to stay.
What’s more, there’d be lobbies from the government to regulate the space, and a proper structure that aligns with the unique complexities of your business would have to be designed and implemented.
You’d need to select the most relevant jurisdictions and legal entities for your business’s needs.
A proper structure would help you stay relevant and assist your business to scale.
Say you want to open a corporate account for your business; one of the primary concerns of the banks is the compliance risks related to KYC, money laundering, and source of funds.
A proper structure would help you assess your compliance procedures, so you can design a robust KYC/AML suitable for your business.
7 Ways To Implement Structure In Your Crypto Business
1.) Choose Your Business Name
Selecting a name is one of the first steps to implementing structure in your cryptocurrency business.
This is particularly important for branding, so your business can survive.
When looking out for a name, ensure it’s meaningful, catchy, and resonates with your crypto business.
Below are a few boxes to tick concerning the name you choose.
- Confirm the availability of your chosen name. Also, confirm if it’s still in use by another business.
Be sure you check the list of registered business names in your state to confirm the availability of your business name while also taking note of trademarks and a proper domain name.
- Another thing to note is to keep the name simple. The names that are easy to remember, pronounce, and spell are usually the best.
- Choose a name that sells. Marketing is king. Ensure your name reflects the brand you’re trying to build.
2.) Get Legal Counsel To Ensure License Requirements
This is important if you care about the success of your crypto business.
Seeking legal counsel lets you understand the regulatory demands of your business as you’d need to get a license in the jurisdiction you plan to run your company.
For instance, if you own a cryptocurrency exchange in a country like the U.S., you must abide by SEC and CFTC rules and regulations.
Again, if you own a crypto exchange, you must adhere to the Know Your Customer (KYC) regulations.
KYC has helped combat money laundering. In the U.S., the Patriot Act has been since 2002.
You must recognize the importance of proper legal counsel for your crypto business.
As a founder, an insight into the suitable form of enterprise enables you to implement your business development and protection plans.
All forms of enterprises have their own advantages and disadvantages.
Whether you want to create a limited liability company(LLC), or a limited partnership (LP), you’d have to determine which one works for the type of business you want to create.
3.) Create A Business Plan, And Identify Your Target Audience
As a crypto business owner, there are questions to ask yourself- who are my target audience?
Who is the best fit for the solution I offer? These could be investors, traders, corporate clients, or random users. This then leads you to start developing a business plan.
Developing a business plan ensures you fully understand the cryptocurrency business and its strategy.
A business plan directs how the crypto business would play out. A typical business plan should contain the following:
- Executive Summary
- Company Overview
- Industry Analysis
- Customer Analysis
- Marketing Plan
- Management Team
- Financial Plan
4. Get Startup Funds For Your Cryptocurrency Business
Depending on the type of cryptocurrency business you’re considering, startup capital may vary. Indeed, you’d have to raise funds for your business.
Cryptocurrency businesses’ primary funding sources are personal savings, family and friends, credit card financing, bank loans, angel investors, and crowdfunding.
Fundamentally, the cost you will incur in the business revolves around the technology in use, legal counsel, government registration, and marketing.
Not all of these funds are needed from the onset. However, you need enough capital to kickstart and drive the business to a highly profitable point. More often than not, you’d have to purchase the necessary software.
You should also consider opening a business bank account. Creating one will ensure steady cash flow.
However, be sure you’re doing business with the perfect bank that would help actualize your business goals.
Analyze and pay attention to the terms and conditions of each bank before sticking with the one that resonates with your business.
5. Get Business Insurance For Your Cryptocurrency Business
This is another way to implement Structure for your crypto business. The type of insurance you need depends on your scope of operation.
Below are some business insurance policies you can consider for your cryptocurrency business.
- General liability insurance
- Auto insurance
- Workers’ compensation insurance
- Commercial property insurance
- Business interruption insurance
- Professional liability insurance
You may have to have a discussion with an insurance financial advisor to know the best policy to adopt for your business.
Insurance is vital because it helps to cover losses in case they happen.
Say you’re running a mining business, and your miners got stolen or damaged; the insurance cover for the losses.
6. Invest In Ads And Promotions
No one wants to own a business with zero patronage. Your customers are the soul of your business.
In fact, they are the reason you remain in business. The more people know about your business, the more profitable you will become.
You’d have to strategically plan the marketing strategy for your crypto business.
Interestingly, we are in a digitally inclined period where marketing transcends beyond traditional means.
Social media is a powerful tool to utilize. Marketing via radio and TV is also quite effective. The goal is to reach more customers to become highly profitable.
7. Offer Customer Support
People like great feedback. Offering efficient customer support can help you stay ahead of competitors.
It may be something other than 24-hour support, but your customers should have a medium to reach you and get real-time responses to their concerns.
It could be through a social media platform, your company’s website, or email.
Setting Up A Crypto Business-its All About Structure
By 2030, the global cryptocurrency market is predicted to have grown to 4.94 billion USD.
This means there are still many opportunities to tap into as a crypto business owner. You can scale a crypto business to a good point with a proper structure.
No doubt, creating and scaling a crypto business is challenging but achievable.
As a founder, you must familiarize yourself with newer trends in your industry. This will make you acquainted with the structure of competition in the market.
It’s also essential to hire the best hands in your business. For instance, if you have to build a crypto exchange, your developers need considerable insight into the APIs and the technology stack to effectively create a solution that would serve the intended end-users.
In all, the crypto industry may be a volatile one. Still, interestingly, we can only expect the best from the industry.