Bitcoin has continued to rise, breaking new all-time highs. As a result, many people, employers included, have begun to consider the implications of paying their employees in bitcoin. In some countries, such as the United States, the answer to this question involves several considerations. Although daunting at first, many employees in the tech sector are seeking payment in bitcoin. 

To understand how businesses can legally pay an employee with bitcoin, let’s start with a brief overview of what bitcoin is, what laws currently regulate cryptocurrency transactions, and some available methods of executing the payment.

A Brief Overview of Bitcoin

The unknown party Satoshi Nakamoto created bitcoin as a decentralized currency. Decentralization meant a nation or coalition of nation-states could not directly control the digital currency.

Bitcoin is also irreversible; therefore, once a party sends cryptocurrency, they cannot reverse it. Therefore, when businesses or independent parties hire a contractor, they must execute caution when providing payment. 

Employers who want to pay in crypto may decide to use a bitcoin escrow service. With escrow, two parties can agree to the terms of their relationship. The terms may include the tasks the contractor must produce and what is considered a project well-done.

Once the two parties agree, both parties create an account on the escrow platform, and the employers will send their funds to the escrow provider. When the transacting parties agree that the agreement is complete, the escrow provider will release funds to the contractor.

There are a few additional considerations that businesses will need to make for full-time employees or salaried workers.

Business Benefits of Paying in Bitcoin

Pay Bitcoin

Businesses are subject to fierce competition, especially when attracting top talent in their local area. However, with an increasingly remote workforce, paying employees across borders can be expensive and unreliable.

Bitcoin and other cryptocurrencies allow payments, enable businesses to easily access and pay skilled workers regardless of their location. The blockchain transfers these funds with greater cost efficiency without paying high remittance fees common in money transmission services.

Low fees are also desirable for small contract jobs, which can help ensure that a contractor is the right fit for the job before engaging in larger projects.

Paying in cryptocurrency also opens businesses up to smart contracts, which can help reduce any legal fees needed to develop employment contracts.

Employee Benefits of Being Paid in Bitcoin


Getting paid in bitcoin has many advantages. Employees, regardless of their location, can get paid faster. With traditional banking services, the process may involve large fees, unfavorable exchange rates, and payments that take several days or weeks to deposit.

Employees who receive payment in bitcoin avoid all of these unnecessary fees and receive a payment within minutes.

Employer Considerations

On the other hand, paying an employee with bitcoin is still not a mainstream practice. Therefore, employers must make a couple of additional considerations.



Paying an employee with bitcoin has many advantages, including being fast and secure. However, there are currently many grey areas about the use of cryptocurrency that are location-dependent.



According to the government of the United States, bitcoin isn’t a currency; it is a property. Still, a lot of the law on this topic remains undefined. For tax reporting, employers may need to convert cryptocurrency to U.S. dollars.

Conversions may amount to a lot of hassle and require a good accountant and/or lawyer to ensure they are making proper deductions.

Volatile Prices

Volatile Prices

Some employees actively seek a regular and predictable salary. However, with the unknown value of bitcoin, it can be hard to determine a standard salary. Some employers have leveraged a payment service that allows a set U.S. dollar amount to be converted to bitcoin at the prevailing market rate to reduce these concerns.

An exchange payment service does solve volatility but doesn’t take advantage of the convenience of quick peer-to-peer transfers. 

Another consideration is the Fair Labor Standards Act, which outlines minimum wage and other employment starts on employee rights. The act requires that businesses must pay employees in cash or another payment of equal value.

Therefore, in some cases governing parties may suggest that paying an employee in crypto does not meet the minimum wage requirement due to its volatility.

Additionally, employers must consider the volatility of the asset. While bitcoin may be trending upwards, it may also experience a market dip causing employees to lose value in the short term.

Some are used to the risk and believe strongly that the value will recover, while others prefer a stable paycheque.