If cryptocurrency is established to disrupt the prevailing financial system by greatly improving the transaction speed, privacy, cost and convenience, it would have been a matter of time before most people are paid in cryptocurrencies.
This is of consumer payment has been evolving since bartering, the first known form of value exchange, for goods and services. Today, the predominant form of transactions occur in the form of fiat currencies, which was initially found in the 7th century. For centuries, the only real change has been how it has been enacted throughout human history. The entire world has adopted fiat digital payments with emergence of debit cards which represent a useful bridge between old and new ways of fiat payments. Interestingly, we are still in the midst of another change which might redefine exactly how we perceive payment – through cryptocurrencies.
Many experts believe cryptocurrencies will be the catalyst for the next payment revolution, which certainly works for new and different payment methods as we’re gradually getting into a completely digitised world. While the popularity with this new kind of currency remains to be observed, there is now a preponderance of crypto bank card options that allow the exchange of cryptocurrency for spendable fiat currency at the touch of a button. Cryptocurrencies, while still an often underestimated means of payment, are receiving their foot in the entranceway because of payment apps and their multifunctionality bitcoin tumbler. Apps, such as Bitpay, Crypto.com, and Revolut, have integrated features that allow buying and selling of cryptocurrencies, along with spending in a few instances, to attract new and savvy mainstream customers for their platforms.
Cryptocurrency as the future of payments
Apps like the aforementioned mentioned are where the future of money and payment are heading. Based on a report by Pew Research Center, it is estimated that significantly more than 2.5 billion folks have smartphones allowing a next of the world’s population to get in touch to the internet and to take pleasure from a wholly digital, and convenient payment experience on their mobile devices. Therefore, in conjunction with appropriate incentives, these apps could drive the brand new wave of adoption to the masses and create real-world use cases for cryptocurrencies.
In August 2019, New Zealand’s tax authorities made a ruling that enables companies to legally pay its employees in Bitcoin (BTC) and other cryptocurrencies.In addition, companies will have a way to deduct income taxes utilizing their current PAYE (Pay-As-You-Earn) frameworks underneath the Income Tax Act 2007. This bold move by the New Zealand’s government is likely to gain the eye of other crypto-friendly nations, which might result in a series of regulatory reforms regarding salary issued in cryptocurrencies, along with a growing interest in more individuals looking to receive their salaries in BTC or other cryptocurrencies. Crypto payment apps that offer Visa-backed debit cards can also gain a good number of users, since these apps allows users to spend cryptocurrencies for real-world purchases. However, it is undeniable that Bitcoin, along with other cryptocurrencies, could be incredibly volatile. Industry is famously unpredictable, and anyone accepting Bitcoin for his or her salary could see the worthiness plummet, along with skyrocket. There must be consideration by a person over what they can afford to lose.
Employee’s salary in Bitcoin
Employers, particularly in the tech startup sphere, are offering employees the option to receive their salary in cryptocurrencies to be able to attract new talents and complementing this with other job benefits. Bitcoin (BTC) is among the most used kinds of cryptocurrencies amongst both employers and employees as preferred cryptocurrency for salary payments. There are numerous reasons including better USD-to-BTC rates (as compared to paying via the native fiat currency) when dealing with internationally-based employees, or if the organization is funded through Initial Coin Offerings (ICOs), where they raised their fundings through BTC, thus a sufficient supply of BTC within their reserve for payment-related matters. Also, it can be seen from existing Bitcoin earners where these employees have deployed various methods to control their crypto salaries.
One approach is through “immediate cash-out,” practiced by Lindsay Holland, assistant director of the Bitcoin Foundation. Like most of the foundation’s employees, Holland receives her entire salary in the currency, and she leverages on the available stablecoins such as USDT or crypto payment apps in case where she must convert them into fiat currencies to fulfill her everyday expenses which could only be manufactured through fiat currencies.
Industry and commerce are truly globalized today, by having an ever-increasing number of workers working remotely. Bitcoin payments could be sent conveniently anywhere, with the main advantage of not having to manage foreign banking, exchange rates, delays and holding times. Although transaction fees might be incurred, Bitcoins are much easier to handle than those historically levied by financial institutions and may also be used as an easy way to onboard employees in the complex world of investments. As opposed to navigating complicated stock options and investment strategies given by brokers and banks, Bitcoin’s direct payment enables a person to take straightforward and instant control of their particular cryptocurrency portfolio. So keeping an open mind to adopting crypto in place of fiat currency might open doors with a lucrative job opportunities.
Encouragingly enough, there are many businesses from the broader world already looking at cryptocurrency as an alternative for the salaries of their employees. In December 2017, the Japanese Internet firm GMO Group revealed that they were offering 4,000 employees the option of earning some of their salaries in bitcoin. Recently, the organization expanded into cryptocurrency mining and trading, commenting that the change was required for “nurturing and developing cryptocurrency literacy.”
Understandably, the aforementioned examples for Bitcoin are not even close to being indicative of a general reality. Cryptocurrencies may gain traction and popularity amongst the people, but they are still struggling to catch up with international financial frameworks and the regulatory bodies which regulate them. The thing is oftentimes deeply ingrained. Bitcoin could be illegal to varying degrees with respect to the country the employee is in. For instance, Bitcoin hasn’t been legal in just about any capacity in Bolivia, during Ecuador the currency was outlawed in mid-2014 within the country’s financial reforms.
On the contrary, China’s stance on Bitcoin has been rather tricky as they have banned ICOs, cryptocurrency exchanges and made mining illegal in the united states, but only recognised and protected Bitcoin since 2013 as a digital asset (other cryptocurrencies are exempted from the recognition and protection for the Chinese law). This may in part be due to the fact that many Chinese citizens are very active Bitcoin trading. Similarly, Internal Revenue Service (IRS), the federal agency of the United States, considers Bitcoin as a property rather than a currency, as the Fair Labor Standards Act requires that employers pay their staff “cash or negotiable instruments payable at par.”
Given the fact legislators all over the world have yet to find out the financial status of cryptocurrencies, it could cause other unwanted dilemmas for people getting excited about receiving Bitcoin as salaries, specifically since the legal regulation may encompass tax-related matters which, with respect to the employee’s location, may become a sophisticated issue. In the UK, HM Treasury issued guidelines in 2018 which stated that cryptocurrencies received as employment payments are at the mercy of national insurance and income tax, but you can find further underlying considerations in other jurisdictions, such as capital gains that must also be factored in.
A Salary Worth Considering
The chance of obtaining Bitcoin as a questionnaire of salary might be an enticing option for many individuals, especially for millennials, that are also seeking a brand new form of investment opportunity that has a lesser learning curve and capital required as set alongside the traditional stock market. However, at the time of writing, cryptocurrencies may carry a lot of stigma due to the perceived risks and legal implications that include moving payroll over to the new financial concept, because most regulatory bodies are still uncertain in the exact categorisation of Bitcoin and other cryptocurrencies in the financial market.
Despite its shortcomings, the team at MyCryptoMixer believes that cryptocurrency is unquestionably gaining traction and exposure in the mainstream market, as evidently shown in growing coverages from mainstream financial media outlets such as Forbes and Bloomberg. Regulatory bodies are taking an active interest and the number of people with an electronic digital wallet is on the rise. If the cryptocurrency space continues to evolve and deliver disruptive solutions for the global financial markets, taking the plunge and switching to Bitcoin for salary payments is surely a huge advance for many people, moving forward.