In a scenario of economic difficulty and inflation out of control around the world, workers have been looking for alternatives to circumvent these problems and not only protect their capital, but have greater control over it.
In view of this, the type of salary payment with cryptocurrencies is growing, as shown by a recent study by Deel, a hiring and payment services company that operates in more than 150 countries. According to the survey, carried out with more than 100,000 workers, the number of crypto payments for people working from home increased from 2% to 5% between July 2021 and June 2022.
What is striking is that more than two-thirds of these transactions were made to workers in Latin America, where Argentina leads the way in payments.
The data is in line with what is seen within Bitwage, a platform that acts as a bridge between companies and workers for the payment of wages in crypto, where half of the approximately US$ 6 million in transactions made per month occur in Latin America, with US$ 2.5 million in Argentina alone.
According to Fabiano Dias, director of international business at Bitwage, Brazil is just behind in the number of crypto businesses in the region, and there are still a few dozen users spreading across other Latin countries.
It is common that in countries that suffer from economic crises, the use of cryptocurrencies increases, as they do not suffer from State action or intervention from other agencies and banks, being a way out for people to be able to control their finances and escape the impacts of problems faced in these regions.
In this Argentina becomes the great example, with a crisis that lasts for years and an inflation of around 60% per year, the country’s government has adopted measures to control exchange and payments. It is in this scenario that a study by Wunderman Thompson, from Buenos Aires, showed that two-thirds of Argentines who invest in cryptocurrencies do so to protect their savings.
But this is not unique to countries in crisis. The method of remuneration has also gained strength in the United States, for example, where some players in the American Football League (NFL) prefer to receive in Bitcoin, as is the case of Odell Beckham Jr.. Miami Mayor Francis Suarez said at the end of the last year that he would also receive 100% of his salary in cryptocurrency.
Privacy and control, even with volatility
Deel’s research shows that Bitcoin (BTC) accounted for just under half of all cryptocurrency payments worldwide, down from the two-thirds recorded in the middle of last year. Even so, she still tops the list.
This could be a reflection of the sharp drop in the crypto market this year, which tends to drive Bitcoin users away. “Volatility risk is real for Bitcoin, however, if you’ve opted for it, you already know how it works, normally [receber em Bitcoin] occurs in situations where volatility does not matter so much, such as when making periodic investments in crypto using the average price strategy,” explains Dias.
That’s what UFC fighter Matheus Nicolau does, who uses this model as a way of looking at an investment in the future. “What I get in crypto is for a medium and long term investment, I don’t get in crypto money that I’m going to need today or tomorrow to pay my bills. I put a small percentage of what I get in crypto […] That’s why I don’t worry if it drops a little”, he says.
The risk and loss of strength of Bitcoin also lead to the growth of so-called stablecoins, crypto-assets that are backed by a fiat currency, such as the dollar, and therefore have a more stable value. At Bitwage, for example, the user has the option to receive in Bitcoin, Ethereum (ETH) or in USDC, DAI and CUSD stablecoins.
Dias explains that, if on the one hand the person can take the risk using Bitcoin or Ethereum as a way to also have more privacy in the payment, there are those who prefer the guarantee of receiving the agreed amount and use stablecoins, but in any case, use crypto turns out to be faster and safer than with other systems.
“I’m not worried about when I’ll be able to access my money, as it drops quickly. I’ve had bad experiences with a bank in Brazil, of staying more than 1 month to be able to withdraw my money. Only I have access to my account. So this is very advantageous”, says Luana Pinheiro, Nicolau’s wife and also a UFC fighter, who receives a fight scholarship and sponsorship from Bitwage.
Who gets salary in crypto?
The profile of the worker who receives in crypto is still very much linked to technology. According to Dias, at Bitwage, 100% of users work online, and about 75% of them are programmers. It is worth mentioning, however, that to use this system it is necessary to receive abroad.
As Silmara Monteiro Bernardo, partner in the labor area of Viseu Advogados explains, in Brazil it is still not allowed to receive a salary in cryptocurrencies. “In addition to the existence of express legislation determining the payment of salaries in cash, salary irreducibility is also prohibited, which could occur as a result of their volatility”, she says.
According to her, the exception is amounts paid as bonuses, which can be negotiated between employer and employee to take place in crypto. In the Chamber of Deputies there is already a bill that could change these rules, but it is still in the initial phase of processing.
With this, it is necessary to find alternatives for payment. In the case of Bitwage, it provides the customer with an account abroad, which will be provided to the company where the service is being provided. With this, this company normally pays the worker in the country’s currency, dollar or euro, for example, and Bitwage converts to the desired crypto and deposits it in the digital asset wallet.
In addition, before payment, users can separate percentages to receive in different cryptos and also in traditional money, thus controlling their finances.
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