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Why Employers Can not Pay You in Cryptocurrency

With the help of recent news headlines recounting the substantial increase in some cryptocurrencies, more members of the public find out what people who have been dealing with digital currencies like Bitcoin already knew it. Although the volatility is constant, it is possible to become rich with Bitcoin and similar forms of non-physical money

You may be wondering why your workplace can not pay your salary in cryptocurrency? Some employers do it – we will cover them later. But first, let 's discuss four obstacles that make it difficult to widely adopt this method of payment.

1. Some Laws Specify Only Payments in Cash or Check

One of the key federal regulations that cover employee wages in the United States is the Fair Labor Standards Act (FLSA). It stipulates that employers must fulfill at least part of their minimum wage by paying cash or check workers – from now on, Bitcoin payments do not apply and the same goes for overtime .

In addition to federal minimum wage and overtime requirements, employers and workers may agree on other forms of payment, if desired. Employers could theoretically pay employees partially with money or checks, and then give them additional amounts consisting of cryptocurrencies.

However, the system is not as simple in some states. For example, Delaware and Texas are two of the states where wages can only be made up of US dollars.

2. Cryptocurrencies can be considered as securities

The Securities and Exchange Commission (SEC) has issued a statement on cryptocurrencies to remind that the investments associated with them can quickly pass through 39, other geographical boundaries without the owner knowing it.

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In addition, the SEC may ultimately decide that certain cryptocurrencies are referred to as titles. In this case, employers should comply with other securities laws in addition to the wage rules mentioned above.

3. Employers May Be Wary

Rapid fluctuations in value associated with bitcoins and other cryptocurrencies can make employers hesitate to pay their workers by these non-traditional means. Likewise, they might think that not enough merchants accept cryptocurrencies as payment again, even if the number goes up.

However, a BitPay debit card allows people to convert amounts from their cryptocurrency portfolios to dollars in minutes. People can then use the most widely accepted currency wherever Visa is accepted. This ability takes care of the potential problem of someone who has a cryptocurrency but can not spend it.

The card also offers a guarantee if cryptocurrency holders learn market conditions that signal a sudden and likely decline in value. In such a scenario, people could quickly make conversions using the card to avoid keeping large amounts of cryptocurrency that could lose substantial value in a few days or less.

4. Tax Consequences Vary Across Countries

If an employer regularly hires remote workers legally residing in one country and paying taxes in another, the different ways in which countries perceive cryptocurrencies can also be an obstacle to adoption.

In Canada, for example, the country regards cryptocurrency gains as barter transactions. US-based companies must convert cryptocurrency values ​​to dollar amounts for the IRS on the dates on which payments take place. Similarly, employees must report all dollar earnings, even when earned in Bitcoins or another currency.

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Depending on the respective country, reporting cryptocurrency revenue for tax purposes could be a simple process. However, companies with a high percentage of international workers may decide that the search for logistics requires too much time-consuming research. If this happens, workers who are keen on cryptocurrency payments could offer to find the details and report back to their employers.

Some companies pay employees with cryptocurrency

Despite the challenges we have presented, pioneering companies exist that pay their employees in cryptocurrencies. Notably, none of the companies are located in the United States, so some of the problems you learned above may not apply to them. Aside from geographical differences, if an increasing number of companies around the world conclude that cryptocurrency payments for employees make sense, this could encourage other entities to follow suit.

Starting in February, GMO Internet, a Japanese company serviced employees salaries in Bitcoin. Employees will be able to receive the equivalent of $ 890 per month in Bitcoins. A representative of the company said that offering Bitcoins as a salary was intended to familiarize the company with encryption methods.

Buffer, a company associated with social media tools Save time and increase traffic. He pays to one of his developers, who reside in South Africa, part of his salary in Bitcoins. In this case, the employee is a big believer in the potential of Bitcoins. As such, he wanted to receive five percent of his salary in the currency.

The man approached a payment partner who works with Buffer and entered into a dialogue, later completing research to find a company specializing in payroll services. cryptocurrencies. He is a good example of a proactive employee who has achieved positive results even if the company did not offer generalized cryptocurrency payments.

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If a company is already in the cryptocurrency market, it can even ask employees if they will accept non-physical payments. This situation occurred at Bitedge, a sports betting facility based in Australia. The web developers of the company receive 100% of their income in Bitcoins.

The future is bright

If you are eager to explore the possibility of making you pay in cryptocurrency, it is crucial to know the volatility associated with cryptocurrency values as well as the possibility that employers may be unaware of digital forms of payment. They may require you to research the details and provide advice.

As cryptocurrencies become more important, it becomes easier to find ways to overcome these difficulties and others. You can strengthen your position as an early and informed adopter and get involved in what could possibly revolutionize the way employers provide compensation.