Even though the crypto winter has set in, remote workers in Latin America and elsewhere still want digital currency in exchange for their work.
Even though the crypto winter has set in, remote workers in Latin America and elsewhere still want digital currency in exchange for their work.
About 5% of all Payments accepted by remote workers were taken in crypto in the first six months of the year, compared to 2% in the last six months of 2021, according to more than 100,000 employment contracts analyzed by Deel, which helps companies to hire and pay people in more than 150 countries. More than two-thirds of crypto withdrawals took place in Latin America.
The increased demand from remote workers to get paid in crypto assets might surprise some, given the $2 trillion crash which wiped out some of the biggest names in the industry and exposed hundreds of thousands of individual investors to major losses. But cryptocurrencies have proven to be a lifeline in unstable Latin American economies like Brazil, Argentina, and Venezuela.
In Argentina — a of the most popular places for remote workers – it’s common to pay them in crypto to circumvent exchange controls and protect them from soaring inflation. Argentina has a higher proportion of workers paid in cryptocurrency than anywhere else, according to Deel. But the collapse of so-called stablecoins has inflicted heavy losses on Argentines who held them instead of converting them into pesos.
In a country with recurring currency crises and inflation of around 60% a year, two-thirds of Argentines who invest in crypto say they do so to protect their savings, according to research by Buenos Aires-based Wunderman Thompson.
Elsewhere, around a quarter of withdrawals were in Europe, the Middle East and Africa, Deel found. Bitcoin accounted for just under half of all crypto payments globally, up from two-thirds in the second half of last year. Deel’s dataset is weighted towards younger tech and finance workers who may be more excited about crypto. Three out of four Deel contracts concern workers under the age of 35.
In North America – where several top football players as well as the mayors of New York and Miami received Bitcoin paychecks – the overall share of crypto withdrawals was just 7%, up slightly. compared to last year, found Deel. The volatility of cryptocurrencies means that some workers risk being charged taxes based on payments that have subsequently fallen in value.
Deel’s wage report also found that remote workers in Italy, whose government is collapsing, have enjoyed the largest average wage increase. Workers there saw their wages increase by 175%, followed by Brazil, India and Nigeria. Overall, the top cities for remote workers, based on the number of employees hired, were London, Toronto and Buenos Aires.