The crypto salaries They are a reality in Latin America. That is, the new way of paying workers’ salaries with cryptocurrencies. Athletes, politicians and freelancers are some of the professionals who are benefiting from cryptocurrencies.
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“The figures confirm that from November 2020 to today there has been a 10% monthly increase in the demand for this type of payment“said Dan Westgarth, Director of Communications at Deel.
Although different regulations do not yet allow cryptocurrencies to replace bank accounts, it is a change that has been increasing. In the second half of 2021, Latin America it was the region with the most cryptocurrency withdrawals in the world, at 52%, according to Deel.
“Receiving payments in Bitcoin or other well-established currencies such as Ethereum, Litecoin or Bitcoin Cash – among the more than 5,000 that currently exist – is attractive to many workers because it offers almost instant transfers and low fees, contrary to the international transactions of the SWIFT system. used by thousands of banks around the worldWestgarth says.
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One of the benefits of crypto salaries is that transactions are made directly between both parties involved in a secure way. In these cases, there is no no financial institution as intermediary and the value is not subject to the country’s monetary policies, according to the expert.
Along with this, cryptocurrencies have the possibility of increasing their value. “A person could end up receiving much more than their base salary if the value of the currency increases, making the ‘crypto salary’ an investment or savings option. Of course, for the same reason, that payment could have the potential to depreciate over time.Westgarth explains.
Now, these transactions also come with challenges. Among them, the volatility. Although the world of cryptocurrencies has made progress in finding a place in the financial system.
“One of the alternatives for crypto payroll, which is already happening, are stablecoins or stable currencies; that is, virtual currencies that minimize the volatility of their value by being backed by fiduciary money (such as the dollar) and that work well as a substitute because they combine the operational advantages of cryptocurrencies with the price stability of money issued by banks.says the expert.
Along with the challenges, there is also the fact that certain financial systems such as credit cards and loans do not work with cryptocurrencies. Thus limiting its usability. In turn, the lack of regulation of these cryptocurrenciesmake it difficult to build a global payroll service.
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“Cryptocurrencies as a means of paying salaries can become a catalyst for the regional economy and a solution for that talent that increasingly works remotely in technology giants, but also in startups and local unicorns that expand throughout Latam and the worldWestgarth says.
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