Benefits of Cryptocurrency Payments for Freelancers in 2023
December 19, 2022
When you’re a freelancer, getting paid can be a hassle. You often have to wait for clients to transfer money to you, and that can take time. Plus, there’s always the risk that they’ll forget or decide not to pay you at all. If you use platforms like Upwork or Fiverr, you may even have to pay fees just to get paid, and this is one of the many reasons freelancers are becoming increasingly interested in cryptocurrencies.
Cryptocurrencies can help with all of these problems, enabling freelancers to receive payments in mere minutes with minimal network fees, free from the control of freelancing platforms, banks, and even governments. Let’s take a look at the benefits of cryptocurrency payments for freelancers and why crypto payments are becoming so popular among professional contractors.
Benefits of Cryptocurrency Payments for Freelancers
1. No Middlemen
At the heart of cryptocurrencies lies the blockchain, a technology that lets people make transactions without banks or other third-party intermediaries. There are no central authorities on the blockchain, which is governed by code and run by decentralized participants. All transactions happen directly between the sender and the receiver. This means that when you receive payments in crypto, there are no middlemen taking a cut, as is the case with traditional payment methods such as PayPal or credit cards.
2. Fast and Global Payments
Cryptocurrencies are often used for international payments, as they can be sent and received quickly and easily. With traditional methods like wire transfer, you can often be waiting days or even weeks to receive your money. Whether your money is being held up because of settlement inefficiencies, or because transfers involving certain regions are automatically flagged, your money is still being held up. With crypto, payments are near instant, no matter where in the world you are.
One of the most popular sayings in crypto is, “Don’t trust, verify.” When you make a cryptocurrency payment, the transaction is recorded on a publicly verifiable blockchain. If a client tries to chargeback or dispute a payment, you can easily prove that the transaction took place by checking the ledger’s records for the relevant information.
4. Increased Security
Cryptocurrency payments are also more secure than other methods, such as PayPal or credit cards. This is because when you receive payments in crypto, the funds are stored in a digital wallet which is secured with a private key. Network validators are incentivized to ensure that assets can only be controlled with a private key, and while it may be possible to fool a validator or two, falsifying a transaction to completion would require hoodwinking the majority of a global network of these validators. Only you have access to this key, and as long as you keep it safe, your funds can’t be stolen.
5. Access to New Markets
Digital assets can be used to represent other assets like gold or even stocks, making markets otherwise closed to the general public far more accessible. Additionally, by accepting cryptocurrency payments, you open yourself up to a whole new market of tech-savvy clients looking to pay in digital assets.
6. Tax Benefits
While certain regions tax cryptocurrencies as investments, which makes them subject to capital gains tax, but many countries have yet to introduce regulation or tax guidance. Depending on where you live or operate your business, accepting and offering cryptocurrency payments could help you save money on taxes.
How to Accept Cryptocurrency Payments as a Freelancer
To accept payments in crypto:
- You must have a blockchain or exchange wallet set up.
- Your wallet’s public address should be known to the payer.
- You should never reveal your private key or seed phrase to anybody, not even your employer.
- The payer must transfer the agreed amount to your address, alongside the network fee or gas fee.
Simplifying Crypto Payments
Don’t you wish sending and accepting payments in BTC, ETH, and USDC was as intuitive as bank transfers? Introducing Binamite, a cryptocurrency payroll management system that provides end-to-end solutions for sending and receiving payments in any combination of fiat or crypto.
Sign up as a contractor, create your invoice, select your preferred ratio of fiat and cryptocurrencies, and hit send! Your employer will receive a notification, and your money will get where it needs to be regardless of whether they decide to pay through crypto deposit, wire transfer, or credit card. You can even set payment deadlines!
Binamite lets you divide your salary into a cocktail of Bitcoin, Ethereum, USDC and your local currency. Additionally, you can adjust your crypto/fiat split on every invoice depending on your fiat needs and how much you’re comfortable receiving in crypto. Binamite also provides regulatory and tax guidance to contractors and businesses on the platform.
Cryptocurrencies are still in their early days, and there is a lot of room for growth. But the benefits they offer freelancers – from reduced costs to heightened security – make them an attractive option for anyone building a career in the modern digital age.