Out of the total global workforce, 31.4% are freelancers. In exact numbers, there are over 1.1 billion freelancers worldwide who are making their livelihood by participating in the gig economy.
For freelancers, their job is all about being their own boss. Working as a freelancer brings its share of perks. It includes flexible work timing, independence of choosing work type, permanent WFH life, thick financial cushioning, and much more. Though one aspect that impact freelancer globally is ‘Challenges of Payment.’
Challenges of Payment in Freelancing and how Cryptocurrency can impact it.
Freelancers who use mediums like Upwork, Fiverr, People Per Hour, etc., are happy with the employment exposure. However, the unjustified platform fee is bringing them to think further.
Or, while working with international clients and receiving payment through PayPal, freelancers often have to settle for unjustifiable exchange rates. The amount it deducts may seem less initially, but the numbers go high if calculated annually.
That is why freelancers across the World today are shifting to Cryptocurrency as their mode of payment.
Cryptocurrency is a virtual money which is highly difficult to fraud or counterfeit. While freelancer receives their payment through Cryptocurrency, there are no platform fees or exchange rates involved. Both clients (Employer) and Freelancer (Employee) are happy this way, considering that the amount transferred is the amount received. Even well-established companies who want to add international freelancers to their payroll can easily avoid several compliances by using Cryptocurrency as the mode of payment.
Reasons Freelancers are Switching to Cryptocurrency as payment for their gigs.
- Payment acceptance from anywhere around the World
Except for the countries that have imposed a stringent ban on Cryptocurrency, there is no issue while sending or receiving international payments.
- The convenience of international transactions
While making bank transfers internationally, there goes a lot of sending and receiving fees. Also, once your client has transferred the money, it can take several days for it to reach and reflect in the receivers bank account. However, with Cryptocurrency, neither the process takes days, nor does it deduct any processing fee.
Cryptocurrency is also convenient for international transaction as the process applies none of the geopolitical rules. We talked with Sam Gupta, owner & founder at online review site BWS and he mentioned about how the freelancers working for his team shifting towards crypto payments in last 2 years.
- Processing within a blink
While freelancers are receiving payments of their gigs in Cryptocurrency, the tradition of waiting has ended. Whether it is a local, National or International payment, with Crypto, it takes only a blink to process.
- Ease of liquidity
When one receives the amount in Cryptocurrency, the process of conversion stays easy. You can exchange one type of Cryptocurrency for other. For example, one can exchange Bitcoin for Binance Coin or Ethereum, Solana, and so on.
Also, exchanging Cryptocurrency for Fiat money is an easy and hassle-free task.
- Form of financial investment
In the past few years, Cryptocurrency has gotten its highest rise which is still increasing. Even if the estimates are believed, digital money will see a new world of success as time goes. This growth and such possibilities thus add to the financial stability of Crypto owners.
For example, the value of one bitcoin in May 2017 was near $2,000. Though today, the same bitcoin values for $64762.71, which is visibly an insane growth.
Thus, freelancers who are looking to their long-term goals are considering payment through Cryptocurrency over other modes. Also, because one of the major downsides of freelancing is ‘Future instability,’ gig workers find some reliability in Cryptocurrency.
- Privacy Value
Bitcoin and other Cryptocurrency proceed with payments anonymous, and thus it does not require sharing any personal data. You, as a freelancer, will not be asked to share your bank account number, PIN, or other crucial details. This saves you from being a target of online hackers and fraudsters.
- Attracts New Clients
Today on the international front, employers are looking for a freelancer ready to accept digital cash. Thus, freelancers are switching to Cryptocurrency to lure more such clients. Because the number of such freelancers is still less, the competition currently is low, which is one advantage.
Disadvantages of receiving payment by Cryptocurrency
Regardless of how many possibilities digital cash is introducing, it surely brings a sack full of setbacks along. Here are a few disadvantages of receiving payment through Cryptocurrency:
- The biggest downside of owning Cryptocurrency is that it can change significantly. For example, if you receive an amount of $10,000 as 1 Bitcoin today, there are possibilities that the value may drop to $5000 or any number shortly.
- Freelancers may accidentally delete their Cryptocurrency or lose their virtual wallets. Or in case the user loses the private key to their wallet, there is no other way of getting back. Without the private key, the wallet will remain locked, and accessing it will become impossible. The situation, in a way, is an irreversible financial loss.
- The number of platforms where one can exchange cryptocurrencies is still very limited.
- Cryptocurrency is a construct of the private sector, and it has no regulation by Financial Conduct Authority (FCA).
- Cryptocurrency is vulnerable to both scams and cyber-attacks. Although the platform is extremely secure, during the exchange, the possibilities of hacks grow high. Several exchanges store the wallet data (the one used to operate the User ID) of users. There have been instances when this data was stolen, providing hackers direct access to multiple accounts. Cryptocurrencies like Mt Gox, Bitfinex, and most importantly, Bitcoin were reportedly hacked and stolen in the past years.
The above words explain enough about the multiple benefits of receiving payments through Cryptocurrency. This trend amongst freelancers is surely going to take speed in the future, specifically while dealing with international clients. Along with the number of advantages, this change certainly brings several disadvantages as well. Though whatever it is, one thing is definite that Cryptocurrency is here to stay and grow.