Rise People announced this week that its clients can now pay their employees in Bitcoin and other digital currencies.
The Vancouver-based startup, which provides businesses with HR, benefits and payroll in one platform, recognized that some of today’s workforce would prefer to be compensated in less traditional ways.
“Digital currencies are changing the way people view and interact with currency and we’re excited to be helping our clients lead that change by enabling them to pay their employees in this way,” said founder Faiz Abdulla.
Unlike fiat currencies, cryptocurrencies are managed through computer algorithms and are not managed by any government or central bank. While this unshackles money from the shadowy chains of Wall Street, the still-underground market possesses its own perils.
There are plenty of reasons why employees, particularly those in the tech sector, are interested in receiving Bitcoin as part of their salary, such as convenience when making purchases online, potential lower exchange rates when converting into other currencies, and taking advantage of currency fluctuations for earning potential.
But there are some things companies and employees should consider before offering or receiving payment in cryptocurrencies, such as tax implications.
“The CRA doesn’t acknowledge Bitcoin or other cryptocurrencies as legal currencies,” notes Julie Bevacqua, CRO of Rise. “Instead, they see them as goods, so when you’re paying employees in Bitcoin, you are actually participating in a barter transaction in which one good or service (the employee’s work) is being paid for with another good (the digital currency).”