Companies around the world are paying employee wages in Bitcoin. Is this a fad or a creative way to manage payroll? Here we profile five companies proving that the use of Bitcoin for payment makes plenty of economic sense. That said, it is perhaps of little surprise that the companies at the forefront of adopting Bitcoin as a valid form of paying employee wages are in the tech industry.
Based in Kitchener, Ontario, Structur3d Printing provides 3-D printing solutions for businesses and individuals. Its flagship product is Discov3ry, a universal paste extruder for desktop 3D printing. Founded in August 2013 by Charles Mire; the startup venture already has a permanent workforce of 10 and a burgeoning developer network around the globe.
To implement their Bitcoin payroll solution, Structur3d Printing partnered with Wagepoint, another Canadian startup based in Waterloo, Ontario. Wagepoint deducts and submits payroll taxes and provides access to online paystubs as well as year-end reports to the employees.
Bench Accounting is a midsized accounting and online bookkeeping company based in Vancouver. The company has well over a hundred employees, demonstrating that even relatively mainstream businesses can migrate to the Bitcoin payroll solution and still make business sense in their industry segment.
According to Wagepoint, well over 80% of Bench Accounting employees who have signed up for the cryptocurrency payment solution collect 100% of their net income in Bitcoin format. It is just the right kind of vindication, if that were needed, that Bitcoin works just as well as any other traditional form of currency. Indeed, it is arguable that Bitcoin provides a form of versatility that isn’t always possible with paper and coin forms of currency.
Amagi Metals, based in Denver, Colorado, is an innovation driven precious metal dealer exploiting the e-commerce platform to provide a global meeting point for both dealers and buyers. The company was founded in 2010 by Stephen Macaskill, a University of Rochester graduate with years of experience in finance, competitive analysis, and cryptocurrency.
With an operation that exists almost entirely on the web, Amagi Metals has a small workforce with fewer than ten individuals on the payroll. The company has teamed with bitWAGE, a California-based Bitcoin payroll solutions provider, to ensure its employees are paid on time and that they fulfill their tax obligations.
Yepa Web Hosting
Although Yepa is a tech company like most on this list, they are well past the startup phase. The company has been providing web hosting solutions since 1996. Yepa is also mainly a European operation with their headquarters based in Rome, Italy.
Yepa is one of the dozens of companies now partnering with BitWAGE to provide wages for their employees using Bitcoin. It is a solution that makes sense seeing that Yepa has a considerable part of their workforce based abroad, where Bitcoins can circumvent the need for pricey currency exchange fees.
Durrell Communications is yet another Canadian tech startup, this time in the field of communications. With a workforce of 6 plus several contractors and affiliates, the company has embraced Bitcoin as a default payroll method for all its employees and contractors. Again, the Ontario company has adopted the Wagepoint payroll solution.
How Bitcoin Payment Solutions Work
Companies offering Bitcoins as part of their payroll solution can choose from a variety of third-party payroll processors to simplify the administrative burden and incorporate some attractive features to their employees.
Most of these payroll services will maintain the security of the employee’s wallet address, deduct payroll taxes and withholdings, then convert the remainder of the wages into bitcoins based on the current exchange rate.
Why Paying Employees by Bitcoin Makes Sense
Not too long ago, Bitcoin critics would have scoffed at the possibility that it would find traction as a mainstream currency for commerce. It was even less likely that there would ever come a time when employees would ask for it as their preferred method for wages.
There are many reasons why companies and their employees are now beginning to see Bitcoins as the preferred currency for payroll:
– Bitcoin is the Best Option for Paying Workers Overseas
Increasingly, companies are having to seek the services of skilled professionals overseas. Processing payments using traditional approaches such as bank transfers are fraught with unacceptable costs in the long run and there are security risks which still rear their heads even with the best of modern financial security guarantees. Bitcoin is easily the most widely accepted form of cryptocurrency, instantly recognizable around the world and does not require conversion into a local currency to be used.
For companies with workers abroad, Bitcoin is a perfectly safe solution. It even goes beyond the limits inherent in traditional payment gateways for international transfer such as Western Union or even PayPal. Owing to the strict regulation regime in place for transfer of traditional currency formats, there are certain countries where transfer of money using these traditional avenues is cloaked around intransigent bureaucracy that many companies would rather not have to deal with. As a virtual currency, Bitcoin is treated by regulators in many jurisdictions as capital and is, therefore, exempt from certain legal requirements attached to bank wire transfer of funds.
– Tax Compliance Made Easy
Not sure how to process taxes on Bitcoin wages? You aren’t alone. Because of the continued evolution and discussion among legislatures around the globe regarding the treatment of Bitcoin as a currency, that can be a difficult question to answer. Fortunately, payroll processors offering a Bitcoin option will handle this for you.
– The Sheer Convenience of it All
Bitcoin transfers happen in real time. As soon as the transfer is done, the payroll solution provider automatically processes the payment and the money, in Bitcoin format or traditional currency formats is available in the employee’s account. Companies like BitWAGE provide their customers with prepaid electronic money transfer cards that can be used just like any other credit or debit card. The payee can, therefore, opt to spend the cash by paying for goods and services (online or in traditional brick and mortar stores). They can also withdraw hard currency from compatible ATMs.