How Cryptocurrencies Are Transforming the Gig Economy and Freelancing
The role of cryptocurrencies in the gig economy and freelancing photo
By: Natali

The role of cryptocurrencies in the gig economy and freelancing

Table of Contents

Gig economy becomes more common day by day. More and more workers have started their freelance journey as the moonlighting, but now they are working with multiple clients simultaneously as experts in the gig economy. Eventually, they start to look for ways to get paid fast and with least possible fees even with international clients.

And the solution here is easy: cryptocurrency! Its global accessibility is already changing the world. And it will become more prominent when younger generations join the workforce. In this article I will review the current state of the gig economy and how cryptocurrencies change it for good.

Cryptocurrencies and the gig economy

Firstly, let’s describe the gig economy to ensure that we all use the same statement for this type of work. The gig economy term usually refers to the labor market where flexible, part-time, or seasonal jobs are more common than 9-to-5 full-time employment options. It often happens in art-related industries, such as cinema, music, design, writing, etc.

During the last 5-10 years, the gig economy has expanded to other professions, such as drivers, marketing experts, and even accountants. In many cases, businesses find it more profitable to pay an independent freelancer for a short time rather than hiring a full-time expert.

It gives businesses the freedom to work with people around the globe. They don’t need to look for people in their local community. They can hire a person who lives in a completely different region. And the easiest way to pay them is by using cryptocurrency payroll services.

You can try sending money directly to the freelancer’s wallet, but it may take a lot of time and nerves to make this payment fully legal. So, it will be easier to use a decentralized payroll service with automated tax filing compliance. In this case, you don’t need to worry about big waiting times like in banks or high fees like in payment services that use fiat money to operate.

Crypto payment services can help solve major challenges faced by gig workers. Employees and freelancers can ask more for their jobs because employers won’t spend as much on fees as they would with more traditional services.

Workers can create their investment portfolios even from their first payroll. They can just go to the crypto exchange and buy any cryptocurrency. It cannot be repeated with traditional investment services, where potential investors need to accumulate at least $3-5K to start their investor journey. It can give them additional passive income and create a sort of income stability, so they can take longer vacations.

Freelancers and gig workers can work from everywhere they want. They can work for New York-based companies and get a NYC salary while living in Hawaii or in another country like Spain or Norway.

Cryptocurrencies are decentralized, so they cannot be controlled by any central authority, even when it’s stablecoins. It lowers the chances of that money being stuck on some middleman account. In the crypto world, funds are sent from one crypto wallet to another.

The most common gig platforms that support cryptocurrencies are Bitwage, LaborX, CryptoJobs, CanWork, Blocklancer, and Ethlance. Each platform from this list supports Ethereum, and multiple also work with Bitcoin. They are the two most popular digital currencies you can convert to fiat or any other cryptocurrency within minutes.

Cryptocurrencies and freelancing

The freelancing industry is currently on the rise. After the pandemic, many people realize that they don’t need to work in the office to get the work done. Moreover, millions of people realize that they can work faster and on multiple projects simultaneously, so they leave their office jobs and start freelancing as individual entrepreneurs.

According to the latest Upwork workforce report, a majority of businesses are hiring but still struggle to find talent under a full-time position. They start hiring freelancers with specialized skills on a part-time and seasonal basis. And the easiest way to pay is by using cryptocurrencies.

Freelance services are asking for fees both from the employer and the freelancer. If they live in different regions and don’t want to use freelance services, bank fees can take up to 20-40% of the payroll. So the easiest way to pay freelancers for a job is using cryptocurrencies. Later, employees can convert it to any fiat currency.

Cryptocurrencies are far more private and secure than traditional payment methods. As I said before, they are fully decentralized, eliminating a middleman and a human factor behind it. Also, cryptocurrencies use more advanced encryption techniques to secure transactions. It helps protect freelancers from potential fraudulent clients who tend to reverse payments on traditional finance services.

Freelancers are fully responsible for paying their taxes. And crypto payroll services are one of the best options for those working worldwide. Freelancers can work with businesses from any part of the world, but at the same time, fill their tax documents with ease.

And last, but not least, the benefit of cryptocurrencies in freelancing is the incredible speed of international payments. It’s such a drastic change from traditional institutions, where transactions may take days or even weeks. With cryptocurrency, the receiver will get money within a few hours.

There are plenty of freelance platforms where you can be remotely paid with cryptocurrencies. You can find interesting projects at gig job services such as Blocklancer, LaborX, or CryptoJobs. Also, you can use BitTask, CryptoGrind, CryptoPool, Steemit, and Bitfortip.

Future of cryptocurrencies in the gig economy and freelancing

The future of the gig economy and freelancing looks promising. As younger generations join the workforce, more and more small entrepreneurs will want to work and be paid by their own rules. And the easiest way to obtain this is by using blockchain.

We will see a growing acceptance of blockchain. As of today, freelancers can find jobs paid by cryptocurrency on special services. But in the next few years, we will see the wider adoption of crypto as one of the payment options on more traditional services like Upwork, Fiverr, PeoplePerHour, etc.

Blockchain’s decentralized nature perfectly matches Gen Z and Gen A’s desire for freedom from traditional institutions. The only dependency that they will keep even with crypto is tax payment. Because, as Benjamin Franklin once “In this world, nothing can be said to be certain, except death and taxes.”.

And taxation will be the major challenge for the next 10-15 years. Various countries will need to create shared crypto laws, so it will be easier to regulate this industry. But those regulations can help to make this industry even more secure for non-tech-savvy users, reducing the risk of fraud.

Crypto adoption in the gig economy can become an impulse for further blockchain adoption in the corporate world. We will see decentralized marketplaces that connect freelancers, sellers, and potential clients without any third party. It’s also likely that in the next few decades, we may see companies that pay salaries for all their workers in crypto.

Wrapping up

The gig economy will become a natural’s part of the modern workforce. People are looking for opportunities to work remotely, and cryptocurrencies could definitely help them with that.

Cryptocurrency is a fast and secure method to send international payments. With traditional finance services, you may wait for days until a payment is completed. With a basic cryptocurrency platform , it will take less than a few hours. With an advanced cryptocurrency platform like Defiway - over a minute.

Using crypto as a payment service for gig workers also eliminates additional fees like in traditional financial services and banks.

However, each allowed party should be prepared for regulations. We already see how the crypto industry is becoming more regulated with various laws and bills. And it will become even more common in the next few years. We will witness more regulations on the national and international levels.

The best way to be prepared for those regulation roadblocks is by using payroll services with built-in tax compliance like PayRoll from Defiway. Using services like this you can always be sure that you are following the latest regulations in the industry. Try it today to assure yourself that it perfectly suits your needs!