When was the last time your salary shrunk by 20% in a single day, or raise by 20% in the next?
The digital age has brought many changes, there has been a recent trend of people getting their salary paid in cryptocurrency rather than traditional fiat currency.
It’s no secret that Bitcoin and other cryptocurrencies have become more popular over the past year or so. Prices for Bitcoin, Ethereum, Litecoin, and other altcoins have skyrocketed, but many have also experienced a rapid drop in value in a matter of days.
Proponents of this new way of being paid say that it has a lot of benefits, such as being able to bypass traditional banking systems.
But is this really something you should consider?
What is cryptocurrency in a nutshell?
Cryptocurrencies are electronic peer-to-peer currencies that exist as digital or virtual tokens which use cryptography to secure their transactions and control the creation of new units. These digital currencies are decentralized, meaning they are not subject to government or financial institution control and don’t physically exist.
Cryptocurrencies are traded on decentralized exchanges and can also be used to purchase goods and services.
In order for the Metaverse to be created, and the Meta Natio (Ecosystem Beyond Nations) to thrive, cryptocurrency will most likely become the primary currency for trade.
The earliest and most popular cryptocurrency is Bitcoin, it is the first and most well-known cryptocurrency, which was created in 2009 by Satoshi Nakamoto.
What is Fiat Currency?
Fiat currency is money that a government has declared to be legal tender that is not backed by a financial instrument or physical commodity such as gold.
The value of fiat money is derived from the relationship between supply and demand rather than the value of the material it is made from.
Fiat money gives the central bank control over the economy because it can control the supply that will be injected into the economy.
Should You Get Your Salary Paid in Cryptocurrency
In a world where digital currencies are becoming more and more popular, it’s no surprise that some people are opting to get their salaries paid in cryptocurrency. After all, it has a number of advantages over traditional currency. But is this the right choice for you?
Here is a look at some of the pros and cons of getting paid in cryptocurrency.
| Advantages of Getting Paid in Cryptocurrency | Disadvantages of Getting Paid in Cryptocurrency |
|---|---|
| Digital currency is secure. | Cryptocurrency is highly volatile. |
| Currency is decentralized and autonomous. | Unregulated by any central authorities. |
| The transaction is Fast and Direct. | Risk of forks or discontinuation of the digital currency. |
Advantages of salary paid in cryptocurrency over traditional currency
Cryptocurrencies such as Bitcoin are becoming more popular as a form of payment. There are several advantages to being paid in cryptocurrency instead of traditional currency.
Here we will look at a few benefits and advantages of getting your salary paid in cryptocurrency.
Digital Currency is Secure
Transactions of any cryptocurrency are irreversible and irrefutable once authorized. This gives cryptocurrency the edge over fiat currency due to its protection again fraud that uses personal information to make a transaction.
Credit cards fraud or any unauthorized transaction of your money from your bank account will not be possible, as cryptocurrencies are encrypted through blockchain technology making it impossible to counterfeit or duplicate.
Getting paid in cryptocurrency ensure that all payment is irrefutable and you will be in control of all the transaction that come and go out of your cryptocurrency wallet.
Nonetheless, cryptocurrencies like anything digital may still be subjected to cyber threats.
Currency is Decentralised and Autonomous
Cryptocurrency is decentralized where it redistributes control over the supply of the currency from a centralized authority such as the central bank or the government to a distributed network of users.
Decentralization is done through various methods such as blockchain technology or delegated Proof-of-Stake systems, which prevents the cryptocurrency from being devalued through the oversupply of a currency.
Theoretically, this will create a democratic and fair system for controlling and regulating the currency.
A salary that is being paid in cryptocurrency will ensure that the currency will not be devalued or depreciated due to oversupply.
Fast and Direct Transaction
A cryptocurrency that is built on blockchain technology has the potential to improve its transaction speed drastically. Crypto transactions take place on a peer-to-peer network without a third-party intermediary financial institute.
Traditional international transfer such as SWIFT transaction requires an average of 2 to 5 working days.
Blockchain technology in cryptocurrency allows a trusted transaction to be performed without the need of a third party such as a bank or to guarantee the transaction, this reduced the time required for the transfer while ensuring all transactions are permanent, visible, and secure.
Being paid in cryptocurrency will improve the speed and convenience of international transactions.
Disadvantages of salary paid in cryptocurrency over traditional currency
Cryptocurrencies such as Bitcoin, Ethereum, or Solona can have many disadvantages over traditional currency. Here we will look at a few risks and disadvantages of getting your salary paid in cryptocurrency.
Cryptocurrency is Highly Volatile
Cryptocurrencies are highly volatile because they are not regulated by governments like traditional fiat currency.
Each cryptocurrency’s worth is based on the trust of the people who trade them, so when people lose faith in a cryptocurrency, the value drops quickly.
Additionally, the technology behind cryptocurrencies is still new and changing, so it is difficult to predict how they will be used in the future. This volatility makes them a high-risk investment, but also offers the potential for high returns.
If you are paid in cryptocurrency, you can potentially walk away with a salary less than what you would get if paid in traditional currency.
The high volatility of the cryptocurrency makes it an unreliable currency for wages or salary.
Unregulated
Cryptocurrencies are unregulated digital assets that use cryptography to secure their transactions.
Digital currency is being transferred directly to others without going through the banking system or centralized authority, which makes it an attractive currency for users who value financial privacy.
However, because cryptocurrencies are unregulated and aren’t backed by any financial institute or government, cryptocurrencies are also subject to misuse and fraud.
Getting paid in cryptocurrency means you are not backed by any central authorities that you are getting paid for the amount which you should get. Dispute on any transaction may become difficult to prove, as most cryptocurrencies are completely anonymous.
Risk Due to Forks or Discontinuation
Cryptocurrencies can have the risk of hard forks or discontinuation because they are not backed by any government or financial institution.
The value of cryptocurrency is depending on the supply and demand, members of the crypto community may have different views on the cryptocurrency which leads to the change in the protocol that governs the blockchain.
Forks or the split of the blockchain network will lead to the creation of new cryptocurrency which creates volatility in the crypto prices.
When substantial price volatility occurs, the cryptocurrency might be suspended from trading in the market-leading to discontinuation of the cryptocurrency.
Reasons for discontinuation of a cryptocurrency.
- Lack of liquidity due to the low volume being traded
- Security breaches of the protocol
- Suspended trading due to unreliable price from the underlying market
Is it good to be paid in cryptocurrency like Bitcoin?
Well… it depends.
It is totally up to the individual to decide if they want to be paid in cryptocurrency.
While there are some benefits, such as the potential for appreciation, there are also drawbacks, such as price volatility.
Ultimately, it is up to the individual to decide if they feel comfortable being paid in cryptocurrency.
Will getting salary paid in cryptocurrency be the future of money?
The future signals a greater mainstream acceptance of cryptocurrency as a form of payment for wages or salary. Currently, cryptocurrency can be an alternative source of currency when we are experiencing crisis situations such as war, where the national currency may have collapsed.
From blockchains to cryptocurrency to NFTs, there is no denying that this technology has evolved rapidly.
Cryptocurrencies have seen a surge in popularity in recent years as they offer a number of advantages over traditional currencies. We can expect more people may start to accept cryptocurrency as a currency that they can use for getting around their daily lives.
On 7th September 2021, El Salvador is the first country to adopt Bitcoin (a type of cryptocurrency) as the official currency, making Bitcoin an official currency as means to exchange goods and services.
Nonetheless, getting paid in cryptocurrency is still in its infancy.
Metaverse may become a catalyst for this change, and more countries will soon adopt cryptocurrency as a vehicle for paying for goods and services.
By then, cryptocurrency may become the future of money.
Read Also:
- Four-Day Work Week: 100% Productivity With Shorter Work Days
- Top New Metaverse Job Opportunities (that Pays Well)
- Benefits of 4-Day Workweek: Shorter Workweek Increase Productivity
- Four-Day Week: List of Countries With 4-Day Work Week
- 10 Biggest Disadvantages of a 4-Day Work Week
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