Ashleigh Green

Cash or Crypto – Can I Pay My Employees With Crypto?

Bitcoin reached an all-time high of over $68,000 in November 2021, despite starting the year at just under $30,000. There is no doubt that cryptocurrency is a volatile market where prices can go up and down at any moment, so why is cryptocurrency at the forefront of most investment discussions, and should employers consider paying employees this way?

While the concept of employee salaries in cryptocurrency is still in its infancy, some major companies including PayPal, Starbucks, and Microsoft have begun to adopt the use of cryptocurrency to pay for apps and games. The Starbucks app also allows customers to reload their Starbucks card with bitcoin and other cryptocurrencies. As major players embrace digital currencies, we must ask how they will be used next.

It is possible for companies to pay their workforce with cryptocurrency; However, unless one has a very strong stomach and a positive outlook on risk, it is unlikely that any employee will accept 100% of their wages in cryptocurrency given its volatility and the currently limited use case. This does not mean that partial salary and/or bonus payments in cryptocurrency will be easily rejected.

the benefits

  • Speed In a post-pandemic world, it is not unusual for employees working from home to be located all over the world. Cryptocurrency transactions are realized and settled almost instantly unlike standard banking transactions which usually take longer.
  • Manpower Appeal Paying in the form of cryptocurrency can give a company an edge in the competitive recruitment market when looking to hire and retain employees, especially when it pays independent contractors or uses freelancers in computing and other high-tech areas.
  • Investment potential It is known that unlike cash payments, the value of cryptocurrency can fluctuate significantly. When the markets are high, employees can actually find that their payment is worth more than if they would have received it via a bank transfer.

As a result, we may start to see a move toward paying rewards and other benefits via crypto. It’s also a good opportunity for employers to start educating employees about investments, while trying to protect assets for their future and/or retirement.

It is also an opportunity to teach employees the basic principles of cryptocurrency as it grows. Due to its relative newness, people are usually less educated about how it works. With proper education, employees will have confidence in the use of cryptocurrencies and how to discover what is legitimate and what is not, which will better protect any crypto assets they own.


  • volatility Cryptocurrency volatility is a double-edged sword. While it can increase in value, there is an increased risk that the value of the asset will decline rapidly, leaving low-paid employees without warning. Understandably, this would be a major concern as employees get paid in crypto, but if it is used for rewards or partial payment, it could reduce the risk. Since employees will not rely on bonuses to pay bills, the impact of any volatility will be less.
  • compliance If you are considering paying employees in cryptocurrency, you should ensure that you comply with the laws of the country in which you work as well as the country in which the employee is located. Failure to comply with the law may result in fines and legal issues if an employer fails to correctly calculate gross and net pay, for example.

tax collection

The next reasonable question about employee salaries in crypto is related to taxes, and there are a few things to consider here. Under UK law, paying employees with cryptocurrency is considered “income” and therefore they will be taxed at the source in the same way as regular salaries. Taxes and national insurance will be deducted, then employees will receive the net amount in cryptocurrency.

Another tax consideration for employers, is that they may have to pay capital gains tax if they are holding cryptocurrencies for the purpose of paying wages and gaining value. The solution is to buy Bitcoin – an agreed value in a normal currency, say £250As soon as possible when needed, rather than stocking up early. Outsourcing cryptocurrency payments to a third party is another viable option to avoid capital gains tax, but it is worth noting that a third party is likely to charge a fee for each transaction.

A benefit to a global workforce

Paying employees in crypto attracts organizations with global workforce. Cryptocurrency transfers usually do not involve major banks or financial institutions, which means that they are sent and received in a much shorter time frame than regular currency, such as the British pound or the US dollar. It is also more resistant to transfer fees, which are charged by major financial institutions when funds are transferred from the original currency of the organization to the local bank of the employee, which can be different, especially for global organizations.

It is important to consider where to use encryption. In some countries, such as China, Nepal, and Tunisia, encryption is illegal. So employers will need to confirm that encryption is acceptable in each employee’s home country, or have separate rules for employees in different regions, which somewhat defeats the simple nature of paying employees in crypto.

Choosing a cryptocurrency

With nearly 20,000+ cryptocurrencies on the market, choosing the right cryptocurrency to pay employees is another important consideration. The most direct option would be for employers to make that choice for their employees. When considering which one to do business with, employers should consider the usefulness of the cryptocurrency, its support, whether it has a high market capitalization (its total value), and how successful it is.

Some predict that the cryptocurrency market will grow from $950 million in 2022 to $6.5 trillion in 2025. This in turn creates huge investment opportunities for those who hold cryptocurrency.


In short, it is possible to pay employees in the form of cryptocurrency; However, if you are considering using cryptocurrency to incentivize employees, either through bonus payments or partial salary payments, you should consider any compliance issues and check if this is something your employees want. Do your employees have the knowledge or experience for proper approval of crypto investments, and is this something your company can implement to be more futuristic?

Over time, it will be interesting to see if paying employees with cryptocurrency becomes more common in line with the growth of the sector in general, and whether we will see any major companies adopting this practice. This is indeed possible, and often the question is who will take the leap first.

#Cash #Crypto #Pay #Employees #Crypto

Leave a Comment

Your email address will not be published. Required fields are marked *