Here’s how some employees are being paid in cryptocurrencies
Getting paid in cryptocurrencies is becoming more popular.
Bethany Goldson enrolled in her company’s crypto payroll feature as soon as it became available this July. Now Goldson, who is a people ops specialist at the HR solutions company Remote, can put part of her salary directly into the cryptocurrency exchange platform Coinbase and avoid all transaction fees.
Although she has been a longtime user of Coinbase, having the process automated is a huge benefit for her that makes it easier to invest.
“I was buying crypto before Remote started offering this as a benefit which made it especially exciting for me, knowing I’d be able to cut back on fees and streamline my finances,” said Goldson. “Before Remote offered crypto payment, I would just buy crypto every now and then when it felt right.”
Paying employees in cryptocurrencies emerged as a hot new benefit last December as companies tried to attract younger workers who wanted to gain a foothold in the crypto economy. Sports figures, artists and musicians are also reportedly being paid in cryptocurrencies.
While paying staff this way is still in its infancy, it’s becoming an increasingly common benefit offered by companies which want to modernize their payroll and benefits packages to attract and retain employees.
“Cryptocurrency is more and more present in the mainstream economy,” said Quentin Vassas, Remote’s vp of payroll and benefits. “We see more and more people throughout the world are interested in having cryptocurrencies. This is even more true in the tech industry.”
Remote’s integration with Coinbase in July has allowed employees to split payments between multiple deposit methods, including bank accounts and cryptocurrencies like Bitcoin. The employee can choose the amount and which currencies they want to receive, which can be updated at any time on the Coinbase platform. By doing it this way, they can bypasses transaction fees and in turn maximize investments because it is cheaper than receiving a full salary in dollars and then buying cryptocurrency after.
“Cryptocurrency capability was often requested by workers employed with Remote and I think it reflects the great trends in how companies provide benefits to their employees,” said Vassas. “Flexibility is very important and how workers choose to be paid is something that is getting more and more important. It has the potential to play a huge role in the future of global payroll.”
Remote is recommending that other companies consider it as well in an effort to give employees greater flexibility and control over their salary payments.
High-profile examples of people who are now paid in cryptocurrencies include New York City Mayor Eric Adams, who said he would receive his first three paychecks via Bitcoin, earlier this year. NFL quarterback for the Green Bay Packers preceded him, and last November announced on Twitter that he would have a portion of his salary paid to him in Bitcoin, via a partnership with Cash App.
There are also other crypto payroll solutions like BitPay and BitWage. On its website, BitWage claims it works with employees from Google, Facebook, Airbnb, and more.
Many companies that offer it, see it as a differentiator against competitors when it comes to attracting talent. “Benefits is making a real difference from one employer to another,” said Vassas. “If we tell them we can offer to convert a portion of their salary into cryptocurrency, it’s going to be something very interesting and attractive, especially for young adults or tech workers who are highly involved in the tech industry. It’s something that’s more and more in demand for companies and employees.”
And it’s a particularly popular benefit among younger employees. More than a third of millennials and half of Generation Z would be happy to receive as much as half of their salary in Bitcoin and/ or other cryptocurrencies, according to Nasdaq
And according to a November 2021 Nasdaq press release, more than a third of millennials and half of Generation Z would be happy to receive 50% of their salary in Bitcoin and/or other cryptocurrencies. Futurist Thomas Frey predicts that cryptocurrencies will displace 25% of national currencies by 2030.
“Benefits is making a real difference from one employer to another,” said Vassas. “If we tell them we can offer to convert a portion of their salary into cryptocurrency, it’s going to be something very interesting and attractive, especially for young adults or tech workers who are highly involved in the tech industry. It’s something that’s more and more in demand for companies and employees.”
Goldson said she views it as an additional option for investment alongside her stock options and 401k. Through Remote, she’s also able to control which percentage – which she didn’t disclose – to receive in crypto versus her traditional bank account.
“I really hope to see other companies follow suit soon,” said Goldson. “It’s a true people-first benefit that allows employees to have as much flexibility as possible. Enabling teammates to have a diverse investment portfolio and encouraging financial well-being is a building block for the future of work.”
However, it is important that the individual gets to decide if they want to be paid this way, as there are risks involved with cryptocurrency given it is such a nascent tech and therefore still extremely volatile. Plus, it is not accepted globally, which is why Remote can only offer this to U.S employees currently.
“We are planning to launch in multiple countries,” said Vassas. “Each country comes with its own legal tax challenges, so we are really moving step by step.”
Rajat Kapur, blockchain sales leader at accounting firm EY, highlighted an important question in a post he wrote for the company’s site in March: If you are paid part of your salary in crypto, how would a sudden and dramatic swing in the value of a cryptocurrency affect your ability to cover your liabilities? For that reason, he advises people to still only accept a small portion of their salary in cryptocurrencies.
Employers who are considering incorporating crypto into their payroll should determine how many employees would be interested, what third-party cryptocurrency payment vendor should be used, and finally educate employees about it and set up terms and agreements.
“Having more innovation and simplifying and people trusting the cryptocurrency industry more, [will encourage] organizations to make it more accessible,” said Vassas. “In the coming months and year, that’s what we’re going to see. It’s a very exciting challenge for both payroll and benefits.”