Turbulence in some traditional currencies has made stablecoins like USDC an appealing alternative for remuneration, HR executives suggest.
Amid global political and economic uncertainties, a growing number of individuals are more inclined to accept their earnings in cryptocurrencies such as Bitcoin (BTC, currently valued at $30,391), as per insights from human resources industry leaders.
In recent years, there has been a noticeable uptick in the percentage of salaries being paid in cryptocurrencies and stablecoins. This trend is not only fueled by high-profile athletes and politicians embracing crypto remuneration but also by everyday individuals seeking to safeguard against various forms of instability, as goLance CEO and co-founder Michael Brooks points out.
According to a Cointelegraph interview with Brooks, the uptick in crypto salaries can be attributed to a myriad of factors, including increased acceptance as a valid payment medium, widespread education, and evolving technology.
He further emphasizes the role of worldwide economic conditions in this upsurge in crypto compensation, stating:
“In regions plagued by political unrest, rampant inflation, or restrictive financial systems, cryptocurrency usage as an alternative transactional medium is on the rise.”
In 2021, goLance made less than 5% of its payouts in crypto. This proportion rose to almost 10% in 2022 and is projected to reach 17% in 2023, according to Brooks. “Among goLance freelancers opting for crypto payments, an average of 17.5% is in crypto, while the rest, 82.5%, is in fiat,” he added.
Dan Westgarth, COO at HR and payroll platform Deel, mentions that numerous global employees have begun to accept their wages in crypto as a counter to the political and economic instability fueling severe fluctuations in local fiat currencies. This instability has made stablecoins like USD Coin (USDC, currently at $1.00) increasingly desirable:
“In countries dealing with significant political and currency turmoil, the use of crypto, particularly USDC withdrawals, continues as a means to combat volatility.”
Westgarth goes on to cite the Caribbean as a prime example for the adoption of crypto salaries, where crypto could potentially circumvent the region’s antiquated banking systems notorious for extended wait times, delayed payments, and banking withdrawal fees.
According to Deel’s data from regions where it supports crypto payroll, Latin America holds the majority share of withdrawals, representing 54% of crypto withdrawals on the platform from January to May 2023.
Crypto salaries in Europe, the Middle East, and Africa accounted for 38% during the same timeframe. Less than 10% of all crypto withdrawals were from the Asia-Pacific and non-aligned movement countries, Westgarth observed.