Do They Understand the Cyber and Financial Risks?
At least one-third of US small and medium-sized businesses accept cryptocurrency as payment for goods and services, a survey released today by HSB, part of Munich Re, has found, with newer companies up to twice as likely to trade in digital credits.
The HSB nationwide survey conducted by Zogby Analytics showed that 36 percent of the small and mid-sized businesses accepted cryptocurrency, while 59 percent of those companies purchased digital currency for their own use as well.
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The business responses were divided by how long they had been operating: 47 percent of companies accepting cryptocurrency had been in business five years or less, compared to only 21 percent in business more than 20 years.
Although the benefits of cryptocurrency can include lower processing fees and faster payments, the risks may increase for cyber fraud and computer attacks, said Timothy Zeilman, vice president for HSB, a leading provider of cyber insurance and services.
“Cyber criminals follow the money and fraud can be a serious problem,” he said. “A number of currency exchanges have been hacked or embezzled and millions of dollars were lost. Smaller businesses, especially those starting out, can’t afford to be cheated.”
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Cyber thieves target small businesses with many schemes, he said, from sophisticated computer attacks to malware infections spread through simple phishing emails.
Smaller businesses also may be targeted by hackers, who infiltrate a company’s data system and divert computing power to record and verify cryptocurrency transactions.
Since digital currency exchanges bypass the banking system, trade globally and operate with little regulation, a small business owner may have nowhere to turn when fraud losses occur.
“Small business owners should learn all they can about the technology before accepting cryptocurrency,” said Zeilman. “And make sure they have strong data security and insurance to protect against cyber fraud and financial loss.”
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