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A business accepts crypto payments in one of three ways: directly to a wallet it controls, through a payment processor that takes the crypto and pays out bank money, or into an account at an exchange. The choice comes down to one question, who holds the keys to the money once it arrives, and everything else follows from it: who converts, who carries price risk, what the fees look like and what records you get.
The technology is the smaller half of the job. Receiving a token takes an address; the business process is the decisions around it: which assets and which network you accept, who can move the funds, what the invoice says, when a payment counts as received, how a refund is made and which rules apply to you. Rules on crypto differ by country; where a rule is cited below, the country and the authority are named, and the whole is general information, not legal or tax advice.
Worked example with illustrative fees, not market quotes: 20 payments totalling $60,000 in a dollar stablecoin, all converted to bank money. Detailed in the last section.
What are the three ways a business can accept crypto payments?
A business can receive crypto to a wallet it controls, through a payment processor that converts the payment to bank money, or into an account it holds at an exchange. In the first, the business holds the keys. In the second, the processor receives the payment and owes the business a payout. In the third, the exchange holds the asset and shows the business a balance.
| Criterion | Own wallet | Payment processor | Exchange account |
|---|---|---|---|
| Custody on arrival | The business holds the keys | The processor, until payout | The exchange, until withdrawal |
| Conversion to bank money | A separate step you arrange | Done for you, at the processor's rate | You sell on the exchange, then withdraw |
| Fee structure | Network fee when you move funds, plus conversion later | A percentage of each payment, sometimes a fixed part | Trading fee or spread, plus a withdrawal fee |
| Set-up | Keys, signers and backups, in hours | A merchant application with business checks | A business account with identity checks |
| Records | The public ledger, plus your own log | Statements with your invoice references | Account statements and deposit history |
| Who carries volatility | The business, from receipt to conversion | The processor, when the rate is locked at checkout | The business, until it sells |
The three are not exclusive. A common arrangement is a wallet the business controls for receiving and holding, plus an exchange account used only as the exit to the bank. A processor replaces both where the business wants bank money and no crypto on its books at all.
Which of the three ways suits which business?
The right way to accept crypto depends on three things: whether the business wants to hold the asset or only the proceeds, how many payments it expects, and who on the team can take responsibility for keys.
A wallet the business controls suits a company that receives a limited number of larger payments, wants the funds available the minute they arrive and has at least two people able to follow a signing procedure. No third party stands between the customer's transfer and your balance. It stops where the business needs bank money, because turning a token into a bank balance still takes an exchange or a similar service. It also places the whole operational burden, keys and handovers included, on you.
A payment processor suits a business with many payments, a checkout or an invoicing flow to plug into, and no wish to hold crypto. It produces the payment request, matches the payment to the order and sends bank money on a schedule. Because the rate is usually fixed when the customer starts paying, the business receives the invoiced amount in its own currency. It stops at flexibility and at cost on large tickets: the fee is typically a share of each payment, and the asset list and payout calendar are the processor's.
An exchange account suits a business that already uses an exchange to convert, receives a modest number of payments and wants one statement for receipts and conversions. It is cheap to run at low volume. It stops at custody and at traceability. The balance is a claim on the exchange, withdrawals can be subject to review, and deposits are not tagged with your invoice numbers, so matching payments to customers is manual. Read the business account terms before publishing a deposit address on an invoice, since some exchanges restrict payments from third parties.
Which assets and which network should a business accept?
A business should accept a short, written list of assets, each tied to a named network, and refuse everything else. One dollar stablecoin on one or two networks covers most needs; every extra asset or network adds a way for a payment to go wrong.
The same stablecoin exists as separate tokens on several networks, and a payment sent on a network you do not monitor may sit at an address you cannot easily use, or may not be credited at all if the address belongs to an exchange that does not support that network. Your list therefore reads as pairs: this token, on this network.
Three criteria decide the list. The first is what your customers hold. The second is what you can convert: the asset and network must be accepted, at a reasonable fee, by the service you use to reach your bank. The third is the cost and speed of the network for the payer, since the payer normally pays the network fee and a transfer that costs several dollars is an obstacle on a small invoice and irrelevant on a large one.
Volatile assets such as bitcoin or ether can be on the list, but then a second rule is needed: how the amount is fixed and how long the quote holds. That is the subject of the articles on pricing goods in crypto and on handling volatility, and it is the main reason many businesses limit the list to stablecoins. Tokens you did not list, wrapped versions and lookalike tokens included, are refused in the payment terms.
Why is a dollar stablecoin the usual choice for a business payment?
A dollar stablecoin is the usual choice because the amount invoiced, the amount received and the amount booked are the same number. A token designed to be worth one dollar removes the price movement between the moment the customer pays and the moment the business converts.
Take an invoice for $3,000 paid in a volatile asset. If the asset loses 4% before the business sells it, the business holds $2,880 and has lost $120 it never agreed to risk. Paid in a dollar stablecoin, the same invoice arrives as 3,000 tokens and converts to about $3,000 less the conversion fee. No quote window is needed and the bookkeeping entry is the invoice amount.
A stablecoin is not bank money, and two points belong in your policy. Its value rests on an issuer's reserves and its promise to redeem, so the choice of token matters; and the issuers of the large dollar stablecoins can freeze tokens at a given address, usually at the request of an authority. Both are covered in their own articles. A business selling in euros or pounds also keeps a dollar exposure for as long as it holds the token.
What must be decided before the first crypto payment arrives?
Seven things must be decided before the first payment: who holds the keys, who approves outgoing transfers, how an address reaches a customer, what the invoice says, when a payment counts as received, how a refund is made, and how the money reaches the bank. They fit on one page.
- Name who holds the keysState the way you accept payments, the people who control the wallet or the account, and where backups are kept. For a wallet you control, use a set-up that needs more than one person to move funds, and record who replaces a signer who leaves. For a processor or an exchange, name the account administrators.
- Write the approval policySet who may send funds out, up to what amount, and who must approve above it. Keep a short list of approved destinations, such as your exchange deposit address and your bank account, and require a second person to approve any new one.
- Fix the receiving procedureDecide where the receiving address is published, who may send it to a customer, and how the customer can confirm it through a second channel.
- Standardise the invoiceEvery invoice states the amount, the token, the network, the address and the date by which the payment is due.
- Define "received"Write the rule that turns an incoming transfer into a paid invoice: the right token, on the right network, at the right address, for the full amount, and final on the network. Name who checks it and where it is recorded.
- Set the refund ruleState the asset a refund is paid in, the address it goes to, who bears the network fee, and who approves it.
- Open the exit and test itOpen the account that converts to bank money before you need it, then run one small payment through the whole path, from invoice to bank balance, and file the records it produces.
The second and third steps are the controls a finance team already applies to bank payments. They matter more here because a transfer sent to a wrong address is not recalled by anyone.
What should a crypto invoice say?
A crypto invoice states five things beyond the usual invoice content: the amount, the token, the network, the receiving address and the deadline or validity of the amount.
Sample wording, to adapt to your terms:
- Amount due: 3,000.00 in the dollar stablecoin named below; the amount received at our address must equal the amount due, network fees being paid by the sender.
- Token and network: the token's ticker and the network's name, followed by "only; payments in another token or on another network are not accepted as payment of this invoice".
- Receiving address: the full address, with a line saying that it can be confirmed by phone on the number already on file and that it will never be changed by email alone.
- Reference: the invoice number, and a request to send the transaction identifier by reply once the payment is made.
- Payment date: the due date, and for a volatile asset the time until which the quoted amount is valid.
The reference line matters because a transfer carries no invoice number. Unless a processor generates a distinct payment request per invoice, the only link between a payment and a customer is the sending address, the amount and the transaction identifier the customer gives you.
When does a crypto payment count as received?
A crypto payment counts as received when the right token has arrived on the right network at the right address, for the full amount, and the transaction is final on that network. A screenshot, a transaction marked pending or a message from the payer is not receipt.
The check is made on your own wallet, your processor dashboard or your exchange deposit history, never on a document the payer sends. It compares four things with the invoice: token, network, address and amount. It then waits for finality, which each network defines differently and which the articles on confirmations and on finality describe.
The rule also covers the cases that are not clean. An underpayment is credited as a part payment and the balance requested. An overpayment is credited or refunded under the refund rule. A payment in an unlisted token or on an unlisted network is not treated as payment until you have recovered it and agreed its value with the customer. With an exchange account, add the exchange's own crediting delay after network finality.
What if one payment has to be shared among several parties?
When a customer's payment belongs to several parties, such as a seller, an agent and a referrer, the business either receives the whole amount and pays the others afterwards, or uses a payment router that divides the payment as it is made. Receiving and redistributing adds transfers and delay.
Shaka is a payment router built for this case. Each party's share is set as a percentage of the deal and can be signed by each recipient before the client pays, the client pays once through a payment link, and every party is paid their share at the same moment, in one transaction. The destinations are fixed before the payment, the payment is final, and Shaka routes the funds without ever holding them. A deal has at most 20 recipients. It does not convert to bank money and is not a processor, an exchange or an escrow service: each party still chooses, among the three ways above, how it holds and converts its own share.
How do refunds work when a payment cannot be reversed?
A crypto refund is a new payment that the business chooses to send, because no network reverses a final transfer and no bank or card scheme can order one back. The customer's rights under the contract or consumer law remain; the refund is simply yours to execute.
Three points are settled in the refund rule. The first is the address. Send a refund to an address the customer confirms at the time of the refund, not automatically to the address the payment came from: a payment sent from an exchange often comes from an address the customer does not control, and funds returned there may not reach them. The second is the asset and the amount. With a dollar stablecoin there is nothing to decide, and a $500 refund on a $3,000 payment is 500 tokens, leaving $2,500 kept. With a volatile asset the terms must say whether the refund returns the invoice value or the units paid. A customer who paid 0.05 units when the asset was worth $60,000, a $3,000 invoice, is owed 0.06 units if the refund is defined as $3,000 and the asset has fallen to $50,000, or 0.05 units worth $2,500 if it is defined in units. The gap is 0.01 units, or $500, and the contract decides who bears it.
The third point is who pays for the transfer. The sender pays the network fee, so a refund costs the business a fee it should either absorb or deduct under a stated rule. An exchange account sends refunds as ordinary withdrawals, with its withdrawal fee and checks.
When is accepting crypto a regulated activity, and when is it not?
Accepting crypto as payment for your own goods or services is, in the United States, not a regulated money service; receiving crypto from one person in order to pass it to another generally is. The line runs between being paid and moving other people's money, and each country draws it in its own rules.
In the United States the reference is the guidance of the Financial Crimes Enforcement Network. Its 2013 guidance on virtual currencies, numbered FIN-2013-G001, states that a user who obtains convertible virtual currency and uses it to purchase goods or services is not a money services business, and its 2019 guidance, FIN-2019-G001, repeats that a person using such currency solely on its own behalf to buy goods or services is not a money services business under its regulations. The same 2019 guidance defines money transmission as the acceptance of currency, funds or other value that substitutes for currency from one person and its transmission to another location or person by any means. It classifies providers of hosted wallets, where a third party controls the users' funds, as money transmitters, and says that payment processors for convertible virtual currency fall within the definition of a money transmitter. The processor and the exchange you may use are therefore regulated businesses in their own right, which is why they ask for your company documents.
The consequence for a business is practical. Selling your own goods and being paid in crypto stays on the unregulated side of that guidance. Collecting a payment on behalf of someone else and forwarding it, holding customers' balances, or converting crypto for third parties moves toward the regulated side. The guidance lists an exemption for a person that accepts and transmits funds only as an integral part of selling goods or providing services other than money transmission, and adds that such exemptions are interpreted strictly. US states have their own money transmission laws, and other countries have their own regimes for crypto service providers. A business whose model involves handling funds that belong to others should take advice on its own facts before it starts.
What does sanctions screening mean for a business that accepts crypto?
Sanctions rules apply to a crypto payment exactly as they apply to a bank payment: a business may not deal with a sanctioned person, whatever the means of payment. In the United States, the Office of Foreign Assets Control states in its sanctions compliance guidance for the virtual currency industry that all US persons are required to comply with its regulations.
That guidance explains that the office may impose civil penalties on a strict liability basis, meaning that not knowing is not in itself a defence, and that since 2018 it has included certain known virtual currency addresses as identifying information in entries on its list of designated persons.
For a business that sells its own goods, a proportionate approach usually has three parts. Know who your customer is, as you would for any large invoice, and check the customer and its owners against the applicable sanctions lists. Check the paying address against the published list of designated addresses, by hand for an occasional payment or with a screening tool where volume justifies it. Keep a dated record of both checks with the invoice. A processor or an exchange runs its own screening, which does not replace your duty to know whom you sell to. A business follows the lists of every country whose law applies to it.
What records should each crypto payment leave?
Each crypto payment should leave a file that lets a stranger rebuild it: the invoice, the transaction identifier, the date and time, the token, network and amount, the sending and receiving addresses, the value in your accounting currency at receipt, and the record of the checks made.
Add the conversion when there is one: the date, the amount sold, the rate, the fees and the bank credit that results. A wallet you control supplies nothing beyond the public ledger, so the log is yours to keep from the first payment.
For bookkeeping, the entry at receipt and the entry at conversion are separate events, as the article on accounting for crypto payments sets out. For tax, the Internal Revenue Service states that digital assets are treated as property and not as currency for US tax purposes, with the fair market value in dollars recorded when they are received in a trade or business; the article on US tax on receiving crypto covers what follows from that.
What does the first month cost under each of the three ways?
In a worked example of 20 payments totalling $60,000 in a dollar stablecoin, all converted to bank money, the first month costs $362 with a wallet the business controls, $600 through a payment processor and $120 through an exchange account. The fees are illustrative; the structure is the point.
The assumptions are these. The average payment is $3,000 and the payer bears the network fee on every incoming transfer. The business converts once a week, four times in the month. For a wallet it controls, it buys two signing devices at $120 each, pays a $0.50 network fee each time it moves a week's receipts to its exchange account, a 0.10% conversion fee and $15 per bank withdrawal. For an exchange account used directly, the same 0.10% and the same $15 apply, without the devices or the internal transfers. The processor charges 1% of each payment with payout to the bank included.
| First-month cost | Own wallet | Payment processor | Exchange account |
|---|---|---|---|
| One-off set-up | $240 | $0 | $0 |
| Network fees on transfers you send | $2 | $0 | $0 |
| Conversion or processing fee | $60 | $600 | $60 |
| Bank withdrawals | $60 | Included | $60 |
| Total, first month | $362 | $600 | $120 |
| Share of $60,000 | 0.60% | 1.00% | 0.20% |
From the second month the equipment is paid for and the wallet route falls to $122, two dollars more than the exchange route, which is the price of holding the funds yourself between receipt and conversion. The processor stays at $600 because its fee follows volume. Changing the volume and nothing else shows how the ranking moves.
| Monthly volume received | Own wallet, first month | Payment processor | Exchange account |
|---|---|---|---|
| $10,000 | $312 | $100 | $70 |
| $100,000 | $402 | $1,000 | $160 |
| $250,000 | $552 | $2,500 | $310 |
With these fees, a wallet you control costs more than a processor in the first month below about $33,600 of volume and less above it, and from the second month the threshold drops to about $6,900. The example leaves out what often decides the matter: staff time. The processor's percentage buys payment matching, rate locking and a single payout line, work that the other two ways leave to your team, and it removes the price risk on volatile assets, which the example does not show because it uses a stablecoin. A business with many small payments usually values that service more than a business with a few large ones. Put your own quotes in place of the illustrative figures before you choose.
