While using cryptocurrencies as a form of compensation has allowed businesses to attract young talent, it comes with both benefits and concerns for employees.
According to a global poll by deVere Group, bitcoin and ether could become more regular in salary discussions for millennials, since some prefer to be compensated in cryptocurrencies.
More than a third of millennials and half of Generation Z would be glad to earn 50% of their wage in Bitcoin and/or other cryptocurrencies, according to a press release.
According to the findings of a global poll conducted by deVere Group, one of the world’s largest financial advisory, asset management, and fintech organizations, 36 percent of those born between 1980 and 1996, and 51 percent of those born between 1997 and 2012, would prefer their jobs to pay in dignified currency “exchange rates.”
Since the debut of the leading cryptocurrency bitcoin in 2009, millennials have witnessed the crypto space expand alongside them. At the same time, technology has advanced dramatically, becoming an increasingly important element of millennials’ lives.
“As they’ve grown older, they’ve been inspired by the big boom in technology, and they’re comfortable with and realize the value in digital currencies, as well as their massive potential.” “Nigel Green, deVere’s CEO and founder stated.
“They appear to prefer a decentralized autonomous digital currency and payment system to a traditional system dominated by legacy financial institutions and governments.”
After reaching all-time highs last month, Bitcoin is continuing its 2021 rise. By market capitalization, the most valuable cryptocurrency is currently trading a little above $66,000.
Workplace attitudes are shifting among the younger generation of workers.
There’s no arguing that workers now have more ability to demand what they want from their workplaces as a result of the Great Resignation.
Aside from greater flexibility and improved benefits, a new workplace perk is gaining traction: the ability to get paid in digital currency.
Cryptocurrencies may become increasingly prevalent in salary talks with younger workers, according to a global poll conducted by financial consultancy deVere Group.
According to the poll, more than a third of millennials (those aged 26 to 42) and half of Generation Z (those aged 25 and under) would be delighted to get half of their wage in bitcoin or other cryptocurrencies.
A cryptocurrency is a digital asset that operates on its own, using computer code and blockchain technology to govern the system without the need for a central authority.
Another survey of 800 US employees conducted by SoFi and Workplace Intelligence found that 42% of them would prefer to receive non-fungible tokens as performance rewards.
NFTs, or non-fungible tokens, are one-of-a-kind assets that are validated and stored using blockchain technology, which is comparable to the networks that support cryptocurrencies.
Payments in digital currency are undeniably “trendy,” according to Tony Jarvis, director of enterprise security for Asia-Pacific and Japan at cybersecurity start-up Darktrace.
“Offering to pay your staff in Bitcoin can be a method to recruit ‘future-thinking workers,’ especially if you’re in certain industries like FinTech,” he continued.
SharpRank is one of the organizations that are willing to pay in cryptocurrencies in order to attract younger employees. It’s a non-profit rating organization that collaborates with college students who serve as brand ambassadors.
The appeal of a crypto wage among the young has been compared to “when Starbucks initially got popular, it was crucial to be seen with a Starbucks cup,” according to Chris Adam, the company’s founder and CEO.
“It’s quite comparable to having some form of cryptocurrency since that’s what all their buddies are talking about.”
We discovered that younger people, who may have higher risk appetites, view risk and reward through a different prism than those who have only ever been compensated in cash.
While using cryptocurrencies as a form of compensation has allowed businesses to attract young talent, it comes with both benefits and concerns for employees:
1. Payments made quickly
Forget about the long wait times, exchange fees, and hidden charges associated with typical bank transfers; receiving money in cryptocurrency may be extremely quick, giving employees a sense of security, according to Mr Jarvis.
“When your employer makes a payment to you in digital currency, it is in your account the following second after your employer makes the payment. You are not required to wait till the next day.”
Payment in bitcoin can be received very quickly, giving employees a sense of security, according to Darktrace’s Tony Jarvis.
According to Sumit Gupta, CEO and co-founder of CoinDCX, a cryptocurrency trading platform, given the increased interest in cryptocurrency among younger investors, it’s “no surprise” that they’d want to get paid in that way.
“They’d have instant access to crypto and be able to hold it in their portfolios without having to convert from fiat, which incurs a transaction cost.” Fiat money is actual money backed by a government.
2. Possibility of avoiding taxes — or is it?
The country you work in is important when it comes to cryptocurrency tax legislation. According to Jarvis, certain countries are “very tolerant” in this regard.
Portugal, for example, is known as a crypto tax haven due to its 0% bitcoin tax.
Mr Jarvis continued, “When you consider how much these assets are appreciating over time, there are enormous gains to be had if you’re saving on the tax side of the equation.”
More governments, though, may strengthen their grip on digital assets in the near future “in order to improve customer trust and safety,” according to Mr Gupta.
Individuals in the United States will be required to record bitcoin transactions to the Internal Revenue Service beginning April 18th.
Mr Gupta went on to say that comparable procedures have been adopted in India, where bitcoin income is taxed at 30%.
“It’s critical for employees who are paid in cryptocurrency to understand how such changes influence holding and utilizing cryptocurrency,” he added. “Staying up to date on policy changes allows users to react fast to developments.”
3. Volatility can be a two-edged sword.
The cryptocurrency market is notoriously volatile.
Even bitcoin, one of the most prominent cryptocurrencies, has been subject to huge price swings since November, plummeting more than 40% from a record high of almost $US69,000.
However, given that bitcoin’s value started at “a couple of dollars” a decade ago, its progress over the last decade cannot be underestimated, according to Mr Jarvis.
“If you get your wage installments weekly or monthly, it starts as a particular dollar value today and grows automatically over time… there are some big returns.”
Although the cryptocurrency market is turbulent, it remains appealing to young individuals with “greater risk appetites,” according to Chris Adam of SharpRank.
Navigating the ups and downs of digital currency “may be a very good experience,” according to Mr Adam of SharpRank.
“We discovered that the younger demographic, who may have larger risk appetites, saw risk-reward through a different prism than someone who has only ever been compensated in cash,” Mr Adam explained.
4. Cybersecurity risks continue to exist.
Though cyberattacks aren’t exclusive to cryptocurrencies, industry insiders claimed that hacks will “persist as long as crypto remains popular.”
Mr Jarvis explained, “A lot of scammers and attackers are targeting crypto wallets – they’re employing social engineering in the same way we get phishing emails.”
“And if you’re not a security professional, figuring out how to protect those assets might be really difficult.” There’s a risk since you’re holding assets on a third-party platform.”
As a result, Mr Gupta recommends picking a cryptocurrency platform that “prioritizes safety and security.”
“Finding platforms that provide asset insurance and anti-money laundering obstacles would reduce risk exposure while using digital finance.”