On top of that, online payment platforms like PayPal also take a cut, which can add up quite significantly over time.
For freelancers in economically disadvantaged areas, these fees can take a significant portion of their income. Cryptocurrencies offer a way to circumvent these high costs, making it easier for freelancers to get paid no matter where they are located.
Additionally, when converting cryptocurrencies to local currency, freelancers often find that the exchange rates are more favorable compared to those offered by traditional banks.
“International transfers are a pain in the head. High fees and bad conversion rates cause a lot of losses as a freelancer,” said Yasser Berrehail, a full-time freelancer from Algeria, in an interview with CryptoNews.com
Traditional bank transactions, particularly international ones, can take up to several days to process. This delay can be inconvenient and can even impact the cash flow of a freelancer.
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In contrast, cryptocurrency transactions can be completed in a matter of minutes regardless of the geographical location of the parties involved. This speed can be a significant advantage for freelancers who work with clients globally.
Inci Ozgur, a part-time freelance video editor emphasized the importance of transaction speed in an interview with CryptoNews.com
“I could either wait for almost 5 working days, just to lose 10% of my money to transaction fees, or I could pay less than a dollar and receive it almost instantly. The choice seems pretty obvious to me,” she said.
This is just a glimpse into how cryptocurrencies are offering advantages over traditional banking methods, particularly for freelancers.
Empowerment and Control: No Middlemen, Full Ownership
One of the standout features of cryptocurrencies is their peer-to-peer transaction model.
This sense of direct control is particularly appealing for freelancers. In traditional systems, the bank or payment service holds your funds and processes transactions on your behalf, essentially acting as a gatekeeper.
With cryptocurrencies, you have complete ownership of your assets as they are stored in your digital wallet , not a bank account managed by a third party.
Transparency and No Account Freezes
Another benefit is the transparency afforded by blockchain technology . Each transaction is recorded on a public ledger that anyone can view, bringing a level of openness that is usually not possible with conventional financial systems.
Additionally, there’s a lower risk of having your account frozen when you deal in cryptocurrencies. In traditional systems, your funds are subject to the policies and whims of the financial institution.
Ozgur told Cryptonews.com about a past real-life experience regarding frozen assets .
“A major bank in Turkey had severe technical difficulties, and their customers weren’t able to withdraw money, or make any purchases. I couldn’t afford to buy a bottle of water for nearly 2 days,” she said.
In contrast, digital wallets are harder to freeze, mainly because users have control over their encryption keys, providing a sense of financial security that freelancers find appealing.
Accessibility and Financial Inclusion
Though they may seem intimidating, cryptocurrencies offer a straightforward approach to transactions as well. Most digital wallets and exchanges feature user-friendly interfaces, making it easier for people to navigate even if they aren’t tech-savvy.
Also, unlike traditional banks, which have set hours and days of operation, crypto transactions can be carried out 24/7—a useful feature for freelancers who may be working with clients in different time zones.
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Cryptocurrencies can also extend financial services to people who don’t have access to traditional banks , which is often the case in less developed countries.
This is especially important for freelancers in these regions, who might not have the luxury of a stable banking system but still need to conduct business globally.
“There [are] not many banking solutions, plus the restrictions according to the local laws [make it difficult]. Crypto made it easy to make transfers without any tracking, so it gave freedom to freelancers to receive and send money,” Berrehail explained.
Privacy and Security
While not entirely anonymous, cryptocurrencies do offer a higher degree of privacy compared to traditional payment methods. Transactions can be completed without the need to share sensitive personal information, reducing the risk of data breaches .
Additionally, some cryptocurrencies are designed to have a limited supply, which can mean a lower risk of inflation compared to traditional currencies that can be printed at will by governments. The stability in value is another factor that freelancers find attractive when choosing a method of payment, particularly in areas hit by hyperinflation.
Implications for the Cryptocurrency Industry
As freelancers start to use cryptocurrencies more frequently for transactions, it’s likely that these digital assets will become more commonly accepted and used.
With more people using cryptocurrencies for practical, everyday transactions like getting paid for freelance work, the perception of these digital assets seems to be changing. They can start to look less like speculative investments and more like functional currencies that people can use for everyday activities.
This could make cryptocurrencies more commonly used for other types of transactions as well, not just within the freelance community.
Regulatory Attention
An uptick in cryptocurrency usage for freelance payments could catch the eye of regulatory bodies, however.
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While increased scrutiny might lead to more standardized practices in the use of digital assets, there’s also the risk of new rules that could limit how freelancers can use cryptocurrencies. These possible restrictions might create new hurdles for freelancers, affecting how beneficial cryptocurrencies can be for them.
New Payment Solutions
As more freelancers turn to cryptocurrencies, there’s likely to be increased demand for payment platforms that make these transactions easier and more efficient.
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Existing crypto wallets and exchanges may evolve to include features specifically useful for freelancers, making the use of cryptocurrencies for freelance work even more practical. Established freelancing platforms may also opt to offer payment solutions to cover cryptocurrencies.
Market Stability
The consistent use of cryptocurrencies for freelance work could have a stabilizing effect on the market. When digital assets are used for regular, everyday transactions rather than speculative investments, it can provide a more stable demand, which could, in turn, influence the market to become less volatile.
Cryptocurrencies clearly offer a range of benefits that can make them appealing for freelancers. Traditional banking and payment platforms often come with fees, slow transaction times, and other limitations that can be particularly burdensome for freelancers, especially those dealing with international clients.
On the other hand, cryptocurrencies often offer lower fees and quicker transactions, not to mention the advantage of being usable anywhere in the world at any time, instantly.
That said, cryptocurrencies are not without their drawbacks. Regulatory uncertainty can make using them a bit risky, and the market’s price volatility could impact the real value of earnings. There’s also the issue of less consumer protection compared to traditional banking systems.
Still, for many freelancers, especially those in areas with less access to traditional banking, the benefits outweigh the risks. Cryptocurrencies offer an alternative that is fast, less costly, and, in many ways, more accessible.