Growing Use of Cryptocurrency for Salaries Causes Remittance ‘Roadblocks’

London (Parliament Politics Magazine) – It is no secret that interest in cryptocurrencies has soared recently, and prices have hit all-time highs, alongside some very sharp downward spokes. Although cryptocurrencies are being adopted by many people, two reports published the week have underlined the growing adoption of these currencies and the challenges that they still face.

According to research carried out by Paysafe, a London-based payment provider, 55% of people who already own cryptocurrency would prefer to be paid their salary in crypto too.  Among 18-24-year-olds, that figure rises to 60% which suggests that more employers could offer this option as younger generations begin to enter the world of work.

The Paysafe report details that the main reason that crypto owners give for wanting to receive payments in cryptocurrency is because they believe it to be a smart investment that will afford them more financial flexibility.

Although over 54% of crypto owners in the survey agreed that cryptocurrency is the future of finance and will likely become the dominant form of international currency, the volatility of cryptocurrency has always been, and continues to be, a major hurdle to it replacing fiat currency.

Separate research has brought different questions to the forefront. Advocates of cryptocurrency often praise its usefulness for sending money overseas, as traditional banks often have very high charges for transferring money globally. According to the World Bank, overseas remittances of $200 can incur an average fee of 5% to 9.3%.

recently published research which shows that over half of the world’s ten biggest remittance recipient countries have bans or significant restrictions on crypto currencies, with countries such as Russia, China and India either banning or seriously restricting cryptocurrencies.

Daniel Webber, CEO of FXC Intelligence, said “Cryptocurrency has fast become one of the most widespread buzzwords in cross-border payments, with proponents claiming that it can increase speeds and reduce costs compared to other remittance solutions. However, in reality, this is not always the case, and our latest research suggests that the overall market will remain severely limited unless key receiving countries enact significant regulatory changes. Crypto definitely has potential to be part of the overall money transfer mix, but don’t expect it to become the sole approach to global payments.”

Beth Malcolm

Beth Malcolm is Scottish based Journalist at Heriot-Watt University studying French and British Sign Language. She is originally from the north west of England but is living in Edinburgh to complete her studies.