The rise in global political and economic tensions has led to a growing number of individuals choosing to receive their salaries in cryptocurrencies like Bitcoin (BTC), according to human resources industry executives. This shift towards crypto payments reflects a desire among both high-profile figures and ordinary people to hedge against instability.
Various factors have contributed to the surge in crypto salaries. One significant factor is the increased recognition of cryptocurrencies as legitimate payment methods, coupled with improved education and advancements in technology. Additionally, economic conditions in different regions around the world have played a role in driving the adoption of crypto payments.
According to Michael Brooks, the co-founder and CEO of goLance, a freelance marketplace, the percentage of payouts made in crypto by goLance has been steadily increasing. In 2021, less than 5% of payouts were in crypto, but this figure rose to almost 10% in 2022. Brooks predicts that it will reach 17% in 2023. Among freelancers who opt for crypto payments, an average of 17.5% of their earnings are in crypto, while the remaining 82.5% is received in fiat currency.
Dan Westgarth, the chief operating officer at Deel, an HR and payroll platform, highlights that employees worldwide are turning to crypto salaries as a response to the political and economic turbulence that has resulted in significant fluctuations in local fiat currencies. Stablecoins like USD Coin (USDC) have gained popularity due to their ability to provide stability amid volatility.
Westgarth identifies the Caribbean as a region where crypto salaries have proven beneficial due to outdated banking systems characterized by long waiting periods, payment delays, and high withdrawal fees. Crypto payments offer an alternative that circumvents these challenges.
In terms of regional distribution, Latin America accounts for the largest share of crypto withdrawals for payroll purposes, representing 54% of all withdrawals on the Deel platform from January to May 2023. Europe, the Middle East, and Africa follow suit with a 38% share during the same period. Asia-Pacific and non-aligned movement countries collectively make up less than 10% of all crypto withdrawals.
As the adoption of crypto salaries continues to grow, it reflects the increasing acceptance of cryptocurrencies as a viable means of conducting financial transactions. Individuals are embracing this alternative in response to economic uncertainty and restrictions imposed by traditional financial systems.
Overall, the rise in crypto salaries offers individuals a way to protect their earnings against instability while enjoying the benefits of faster transactions and reduced fees associated with traditional banking methods.