Will Workers Be Paid in Bitcoin and Cryptocurrency in 2022?
Over the past year, managers and company owners had to scramble to find employees. After decades of taking workers for granted, they had to make changes when the COVID-19 pandemic upended the world. As of early 2022, employers have 11 million jobs available, but few people are willing to take them. In order to find capable employees, employers have had to get creative with compensation and perks. From sign-on bonuses to flexible, hybrid, and remote work locations and schedules, employers are more adaptable than ever. Even with mentoring, free tuition, and casual dress codes, employers have still had a challenging time filling empty positions. Payments in cryptocurrency may be the sweetener that employees need in their proverbial cups of coffee.
In 2021, the values of digital coins and other assets soared. Many new cryptocurrency projects took off, and the rise in value and use piqued interest among Americans and people all over the world. Some people see digital assets as a way to avoid devaluing the American dollar. Others see it as a hedge against inflation. Young people may view it as a you-only-live-once strategy for quick riches.
Young people and working professionals with a high debt load and astronomical rent or mortgage payments may feel that digital assets are the best way to get ahead of the financial game. When a person gets paid in American dollars, inflation decreases the value of their paycheck. The fast rise in the cost of living, which was about 10% in 2021, was the catalyzing force behind many of these changes.
People who didn’t get a substantial raise in 2021 basically got a devalued paycheck. Their lower purchasing power leaves them in a bind. It’s like a race where you’re standing still and everyone else is rocketing past you. It takes more money to buy the same product compared to one year ago. From fuel to rent and food to footwear, everything is more expensive in 2022.
Many local leaders are enacting change now. The mayor of Miami, FL is offering public employees the opportunity to receive all of their pay in Bitcoin. Some sports stars have accepted partial payments in Bitcoin. With more remote workers than ever, employers are looking to third-party providers to deal with cryptocurrency payments and the associated payroll taxes. These vendors assist employers and employees with setting up digital wallets and connecting them with bank accounts.
If an employee accepts their wages in cryptocurrency, they will need to be brave. There is no guarantee that Bitcoin or any other digital asset will hold the same value tomorrow that it holds today. This volatility is not for the weak stomach. In 2021 alone, the value of Bitcoin ranged from $30,000 to $67,000. Most people don’t want that level of volatility in their paychecks. Workers will also have to pay taxes on the higher value, which could have big impacts come April 15. Some may have to do quarterly estimated taxes, which can be a hassle. However, payment in Bitcoin could be a thrilling way to enhance wealth for a person who lives off the excitement.