BLOG
A Maltese barbershop, "Plan B," has expanded its business by embracing Bitcoin, leveraging the Lightning Network for instant transactions. By holding onto Bitcoin, the shop has established a financial reserve and attracted a loyal client base.
In Malta, a barbershop has transformed its operations by embracing Bitcoin.
The “Plan B” barber shop opened its first location in 2019. A few years later, the owner was able to expand and has just opened his third shop.
Part of the success is accredited to Bitcoin and Plan B has set an example as one of the first businesses to accept Bitcoin payments on the Maltese Islands.
For over four years, Plan B barbershop has accepted Bitcoin as a payment method. Through the utilization of the Lightning Network payments are instant with minimal transaction fees.
This innovative approach has set the barbershop apart from competitors and has significantly enhanced its financial standing and customer engagement.
The decision to accept Bitcoin was not merely a marketing strategy; it was a calculated move that has had profound impacts on the business's operations and financial health.
One of the notable benefits experienced by the barbershop from accepting Bitcoin is the establishment of a bitcoin reserve.
By holding onto Bitcoin instead of converting it immediately into euros, the business has banked on Bitcoin's excellent function as a store of value.
Over the years, as Bitcoin's value has increased, so too has the barbershop's financial stability.
The Bitcoin reserve has improved its balance sheet and creditworthiness, enabling better terms on loans.
With higher capitalization, the business is able to expand and consider investments earlier than had it sold off its bitcoin.
https://www.instagram.com/p/C9PLZ3RAhZ4/
Holding Bitcoin is often falsely described as a hedge to inflation. The more accurate description would be that it's a solution to inflation as the bitcoin supply has a hard limit of 21 million. This also means that bitcoin appreciates significantly in value over time as more people use it as a store of value.
Many businesses face rising costs and economic uncertainty and this strategic accumulation of Bitcoin positions the barbershop favorably within the local economy.
Accepting Bitcoin has also helped cultivate a loyal client base. Customers who prefer to pay with Bitcoin are drawn to this particular barbershop not just for its services but for the unique experience of transacting in digital currency.
This demographic often includes tech-savvy individuals and enthusiasts who seek businesses that align with their values and payment preferences.
The recurring clientele built around this payment method reflects changing consumer behavior. Many customers appreciate the transparency and security that Bitcoin offers compared to traditional payment methods. The choice to pay with Bitcoin often signifies a lifestyle choice for these clients, making them more likely to return for future services.
In addition to financial benefits and customer loyalty, accepting Bitcoin has enhanced the barbershop's credibility as an innovative business. As Bitcoin gains traction globally, businesses that accept it are often viewed as forward-thinking and adaptable. This perception can be crucial in attracting new customers looking for modern services that fit their digital-first lifestyles.
https://www.instagram.com/p/DBJ7qr-gdc8/
PlanBhttps://www.instagram.com/p/C9PLZ3RAhZ4/ stands out not just as a place for grooming but as part of a larger movement towards integrating digital currencies into everyday transactions. This positioning allows it to connect with networks of Bitcoin advocates who actively promote businesses that accept this form of payment.
A key component of this barbershop's success with Bitcoin is its use of the Lightning Network, which is designed to facilitate faster and cheaper transactions. The Lightning Network operates as a second-layer solution built on top of the Bitcoin blockchain, addressing some of its inherent scalability issues.
The Lightning Network enables users to create off-chain payment channels that allow for instant transactions without congesting the main blockchain. When two parties wish to transact, they establish a multi-signature wallet that holds a certain amount of Bitcoin. Transactions between these parties occur off-chain, allowing them to update their balances without broadcasting every transaction to the blockchain.
This system significantly reduces transaction fees and enhances speed, making it feasible for small payments—such as those for grooming services—to be processed efficiently. By conducting transactions off-chain, the Lightning Network alleviates congestion on the main blockchain while maintaining security through smart contracts.
To illustrate how accepting Bitcoin can transform financial outcomes for any business, let’s take a look at the numbers. We use a random example of a coffee shop to visualize the benefits of accepting bitcoin.
In this coffee shop, consider their average payment scenario of five weekly payments averaging $20 each in Bitcoin.
Initially priced at $20,000 per Bitcoin, each $20 payment translates into 0.001 BTC.
With 1,040 total payments over four years (5 payments per week), this results in a total value at the initial price of $20,800.
Fast forward to when Bitcoin reaches $90,000; each payment now holds greater value at $90 per transaction. Consequently, all payments combined would now total $93,600 at this final price point.
Of course this is extremely simplified and the bitcoin price goes up and down every day. However, if we look at historic data, we can get a grasp of how sound money can strengthen your balance sheet.
In the example below, a business has received $10 per day for the period of 10 years resulting in a total of over 25 Bitcoin accumulated. While the dollar amount is only $36,510 ($3,651 per year), the Bitcoin holding is now worth north of $2 million.
Plan B has strategically utilized bitcoin to lower cost and expand the business. By reducing card processing expenses and securing profits with bitcoin, the financial situation was improved.
Furthermore, the loyal customer base has grown. The unique offering of accepting bitcoin as a form of payment creates trust and long-term brand value.
Today Plan B can rely on its community of customers and the mathematically ensured scarcity of bitcoin. Those advantages fuel the growth of the business.
While fiat currency is plagued by inflation and margin pressure, a business that utilizes bitcoin can bank on the long-term stability and growth of sound money. This yields not just material gains but also hope and optimism.
Plan B has already opened its third location and is planning to expand further in the near future.
The barbershop's decision to accept Bitcoin has not only facilitated immediate transactions but also allowed it to protect capital over time. By holding onto Bitcoin instead of converting it immediately into fiat currency, the business has significantly increased its revenue potential.. This scenario underscores the financial advantages that can arise from adopting innovative payment methods like Bitcoin in traditional business settings.
As more consumers become comfortable using Bitcoin for everyday transactions, this proactive approach may serve as a model for other small businesses considering similar paths. The concept of a "Bitcoin barbershop" could soon become commonplace as entrepreneurs recognize the benefits of early adoption—one haircut at a time.
