Many companies around the world are offering their employees to pay salaries in cryptocurrencies instead of fiat. This trend began not so long ago, and now more and more companies are trying to attract and retain specialists in this way. Even athletes, artists and musicians sometimes choose to get paid in digital currencies.
Back in November last year, for instance, National Football League quarterback Aaron Rodgers, who plays for the Green Bay Packers, announced on Twitter that now he would receive a piece of his salary in Bitcoin thanks to a partnership with Cash App.
Moreover, earlier this year, New York City Mayor Eric Adams announced that his first three salaries would be paid in Bitcoin! So, crypto salary is a real thing now – let’s see how it works and what to expect from it.
Why crypto?
Despite the growing popularity of digital money and different crypto services, it is still not really obvious for most of us why we should even consider crypto salaries. For sure, before agreeing to an employer's offer to receive cryptocurrencies instead of fiat, you need to understand whether this option is right for you. Experts believe that cryptocurrencies have a lot of advantages over traditional payments. Here’re some of them:
- Speed. You can receive a salary in cryptocurrency instantly. You don’t need to wait until some bank will process the transfer because now you don’t need a bank at all. Assets will be directed to your crypto wallet immediately without any middleman.
- No banks. You don’t have to open an account in a specific bank. Cryptocurrency is transferred to any convenient address, and then you can choose which card or account to use to withdraw money to. Hopefully, soon you won’t have to transfer crypto to fiat and withdraw it from the bank card at all. The more companies will accept crypto, the easier it will be for us to use it for direct payments. In the meantime, you can buy and sell cryptocurrencies here.
- Stablecoins. Salaries can be paid not only in Bitcoin and Etherium, you can also receive it in stablecoins, the exchange rate of which should be 1 to 1 to the dollar. Thanks to this, you won’t be tied to the national currency of your own country if you want to work in international companies.
- Control. It’s really hard (nearly impossible) to steal your funds. Cryptocurrency belongs only to its owner and no one can take possession of it if the person does not have a special private key.
- Investment opportunity. You can simply leave your funds in a crypto wallet and start trading. Thanks to that you can multiply your salary, but don’t forget to do research beforehand.
Many of those who nowadays receive a salary in cryptocurrency took this step because of cheap transactions and the absence of intermediaries. They see this solution as a way to increase their earnings in the long run.
What’s the catch?
It is important for the employees to decide for themself whether they want to receive payment in crypto or not. In the end, cryptocurrencies are a risky investment.
The main obstacle of getting paid in crypto is still the uncertainty of the legal status of cryptocurrencies. In most countries, cryptocurrencies are not accepted as a means of payment (with few exceptions like El Salvador). You need to find out if there are any restrictions around using or trading crypto in your country. And is it legal to spend it or to convert to fiat? Different countries have different rules so be careful with that. It's all the same with taxes - find out about tax regulations for crypto in your country.
Don’t forget about volatility! The value of your payment can change without any warning. The amount you were expecting and the amount in the check can be different if the crypto exchange rate suddenly changes. Therefore, experts recommend taking a combined approach — take the minimum wage in fiat, and bonuses in crypto.
Also, there’s a frightening amount of scams in the cryptocurrency sector. There are hundreds of different techniques aimed at stealing your funds. Therefore, you need to be extremely careful with the crypto: double-check all addresses and links. Tips on how to secure your funds, you can find here.
Make a decision
The number of employees considering payments in crypto is growing. Research made by SoFi, has shown that more than a third (36%) of employees are ready to receive salary in cryptocurrencies, and 42% would like to receive NFTs as a performance reward.
That research proves that many people are okay with getting paid in crypto. You should choose which option is best for you. Before making a decision, consider all pros and cons of crypto salaries one more time, and don’t forget about the opportunity to be paid in both – crypto and fiat.
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