Cryptocurrency is becoming increasingly popular as a payment option for remote workers in Latam, as per the latest report from the Deel Lab for Global Employment. The reasons behind this development are said to be multiple, ranging from the instability of local fiat currencies to the influence of high levels of inflation in the region.
Crypto Payments on the Rise Among Remote Workers in Latam
A survey conducted by the Deel Lab for Global Employment reveals that the usage of cryptocurrencies for payments in Latam is on the rise. According to the report, the usage of crypto for payments in the region went up from 61% to 64% during 2022 — more than double the usage of these tools that the second region, EMEA, saw at 27%.
The reasons behind the preference for crypto, dwarfing usage in other markets, have to do with the conditions of the region and how these workers use their resources to counter their economic difficulties, as the report notes. Even with the recent dip in prices in the cryptocurrency market, getting paid in cryptocurrency allows remote workers in Latam to transfer this liquidity into non-fiat-based assets or more profitable options.
On this, Natalia Jimenez, regional manager at Deel, stated:
The current economic landscape of Latam has created a need for workers to diversify their income and take care of their savings. Receiving their salaries, or part of them, in cryptocurrencies, grants them the ability to protect themselves from the fluctuations of exchange rates, invest, and have more flexibility over their finances.
The report found that bitcoin is the favored cryptocurrency for payments, accounting for 64% of all transactions. USDC, Circle’s dollar-pegged stablecoin, ranks second at 26%, and ethereum ranks third at 7%.
Other Markets React Differently
While crypto payments are on the rise in Latam, other markets have not followed the same trend due to the bear market in the cryptocurrency space that prevails in regions with more established payment systems using fiat currencies, which do not depend heavily on crypto for remittances and savings products.
The report acknowledges this fact, noting that “due to the crypto market situation, workers have lost some interest in receiving payments in cryptocurrencies.” This could be associated with the usage that crypto sees in Latam markets, which is focused more on real-world applications as per a report issued in August by Kaiko, as opposed to the investment-speculative nature of crypto in other markets.
What do you think about the expanding usage of cryptocurrency as a payment option for remote workers in Latam? Let us know in the comments section below.
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