- By Check-a-Salary
- Posted Wednesday 29
th June 2022
Cryptocurrencies have the potential to revolutionise how we think about and use money. Many people believe that Bitcoin, the first and most well-known cryptocurrency, is the future of getting paid.
In fact cryptocurrencies, like Bitcoin, are digital assets that were designed to be stored and be a medium of exchange. This peer-to-peer (P2P) digital currency is decentralised, meaning it is not subject to control from any government, financial institution or middlemen.
While there are definitely benefits to using cryptocurrencies such as providing a more efficient way of conducting transactions, there are also some risks. They are volatile, meaning their value can fluctuate greatly. The prices of cryptocurrencies can be affected by things like news events, government regulations, and even a simple Tweet by Elon Musk.
In this article, we'll take a closer look at each of the arguments for and against getting paid in Bitcoin.
Arguments in Favor of Getting Paid in Bitcoin
No Cross-Border Remittance Fees
The most important advantage of getting paid in Bitcoin is that there are no cross-border remittance fees. This can be a big benefit if you have family or friends who live in another country.
Businesses with clients abroad can also make use of this mode of payment. Multinational companies that operate internationally have the potential to save costs by paying their employees worldwide in Bitcoin.
Paying via traditional banks, companies would have to bear the processing and conversion fees to send money abroad - but with Bitcoin, you can send any amount of money to anyone in the world and bear no processing fees that is usually charged by the middleman when trading in fiat currencies.
Paying employees in Bitcoin can be an option to attract tech-savvy talent. Employees can benefit by converting from Bitcoin to fiat currencies only when they get a better exchange rate. In addition to that, the value of Bitcoin is not tied to any one country - so it can be less impacted by fluctuations in individual currency markets.
Buying and Selling Bitcoin is Now Simple
Unlike physical currencies where you need to go through the hassle of opening up a bank account, it is very simple to create Bitcoin wallets. You just need to install the application and your wallet gets created automatically.
Nowadays there are also applications that provide payments infrastructure that allow trading (previously you had to create an account with a reputable cryptocurrency exchange or P2P platform.)
If you need to make payments to someone in Bitcoin, the process has now been made very convenient. When transferring an amount, you just need to know the Bitcoin wallet address of the receiver and press send - it is that simple.
In addition to that, you can buy Bitcoin with a debit card and see the digital currency added to your wallet instantly. Such card payments are 3D Secure so customers are protected from fraudulent transactions.
Many Big Merchants Accept Bitcoin
Many big merchants have already started accepting Bitcoin as a mode of payment. Here are some of the big names in different industry verticals.
Virgin Airlines and Virgin Mobile have also started accepting payments in Bitcoin. Additionally, Virgin Galactic will accept Bitcoin as the mode of travel to space. In fact, with 16 BTC you can buy your space flight.
Microsoft has been one of the earliest adopters by allowing games to be bought via Bitcoin.
Benfica, a sporting club in Portugal, became one of the first clubs in the footballing world to start selling merchandise and tickets in the digital currency.
Moreover, HomeDepot became the first retail home improvement multinational to start accepting payments in Bitcoin. Similarly, Whole Foods allowed store payments to be done via Bitcoin and also allowed the digital payment to make purchases via a mobile application.
Wikipedia, the famous encyclopedia as we know it, started allowing people back in 2014 to pay for donations through Bitcoin.
Even some charities, such as the international NGO “Save The Children” have started accepting Bitcoin as a mode of payment. You can learn how to gift cryptocurrencies to a charity organization that accepts donations in digital currencies.
Transactions Are Quick
Do you want to send across money to your family member back home immediately? You can send them Bitcoin and they will receive them instantly.
The best part about trading in cryptocurrency is that there is no more waiting time to receive money. When transferring an amount via banks, transactions only happen during the working hours of banks.
On the other hand with Bitcoin, as soon as you confirm that you want to make a transaction, the funds are transferred immediately. Bitcoin makes urgent payments possible and is more suitable to today’s fast-paced world.
Arguments Against Getting Paid in Bitcoin
No intrinsic value
On the other hand, there are some drawbacks to getting paid in Bitcoin. One of the main concerns is that Bitcoin has no intrinsic value of its own. Bitcoin has a fixed cap of 21 million digital coins, from which around 19 million have been created, so many people invest in the currency solely because of its scarcity.
Additionally due to its volatility, there is also less peace of mind associated with earning and trading in Bitcoin.
Mistakes are irreversible
Another concern with using Bitcoin is that since there is no central authority that manages the coin, it is not possible to rectify any transaction. Imagine you transferred an amount to someone by mistake. Unfortunately, you will lose that amount. It simply cannot be reversed.
With traditional banking, you can call customer service and have them cancel the transaction. But with Bitcoin, there is no customer service to call - you would simply lose your money.
Less accessible than physical currency
Lower income people do not have access to smartphones and digital wallets so accessibility of cryptocurrencies can be an issue. If digital currencies become widespread, socioeconomic disparities will worsen especially because households with limited digital connectivity will become cut-off.
Users also need to be literate enough to learn adequate knowledge about cryptocurrencies. Even if a person starts to learn, the problem is also that not all cryptocurrencies work in a similar manner. For instance, Bitcoin is mined, whereas Ripple is not mined. Similarly, one needs to have basic knowledge of which coins are working well and which are not.
Can be used for illegal purposes
Since cryptocurrencies are not regulated by any centralized governmental institution, there is a higher possibility that it might be used for illegal purposes such as money laundering and tax evasion.
People can simply set-up a digital wallet and start receiving and sending payments without any proper Know Your Customer (KYC) checks. The lack of regulation could lead to serious legal implications down the road, especially if the government decides to crack down on illegal activity associated with cryptocurrencies.
Final Verdict: Is Getting Paid in Bitcoin the new future?
So, is getting paid in Bitcoin the future? Ultimately, the decision comes down to its stability and widespread acceptance. As of now, many companies are sticking with traditional fiat currencies due to the concerns about the volatility and other risks associated with cryptocurrencies.
It is true that the number of consumers who have started using Bitcoin is on the rise. However, the question about the number of consumers who are currently using Bitcoin depends on personal risk tolerances. People who are comfortable with the risks of trading in cryptocurrencies are the ones most suitable for using the digital coin in their daily lives.
In addition to that, there is also the solid argument that mistakes cannot be rectified if you accidentally transfer an amount by mistake - this is usually not the case when you make a transfer using the conventional banking system.
However, despite the risks many still believe that cryptocurrencies are the future of money. They provide a way to conduct transactions without the need for a third party, such as a bank, financial institution or a middleman. They can also help reduce costs associated with traditional banking and financial transactions.
As more people begin to use and accept cryptocurrencies, their acceptability is likely to increase. In the contemporary era, there are also some stablecoins that can be used as a medium of exchange, which can help to mitigate some of the volatility associated with Bitcoin until it reaches a desired, stable value.
Overall, there are both advantages and disadvantages to getting paid in Bitcoin. You need to carefully weigh up the pros and cons before deciding if adapting to this mode of payment is the right choice for you.
Osama is a technology content strategist who is passionate about content marketing and all things SEO. He has helped various companies in ranking their content on the first page of SERPs. In his free time, Osama loves to play football and travel.
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