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Cryptocurrency and the new age of the Gig Economy

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Source: Wikimedia

COVID-19 changed a lot of things including, but not limited to, increased awareness towards hygiene, mental well-being and even how people use the currency. However, there is another shift visible in the job market. Probably as an extension of mental well-being – nowadays people are turning towards short-term contracts and freelance work where they can plan their day. Apart from autonomy, one big advantage of freelance work is not having geographic boundaries. You can stay in the comfort of your house and work for an organization that is situated in a different country.

Not only does this benefit individuals, but it also benefits organizations to hire people short-term, quickly, and get their job done. Needless to say, the advent of technology has opened up a lot of opportunities, and this shift towards a new model is being called the Gig Economy.

Gig Economy in the UK

According to the Office for National Statistics, in 2020 a total of 14.5% of all employment in the UK is centered around the gig economy. If we look at the shift, it is 72% from what it was in 2010! Furthermore, if you look at the wages, there isn’t much change as gig workers earn an average of £11.40 as compared to £13.20 per hour by non-gig workers. The majority of the gig workers belong to the ride-hailing services sectors – Lyft/Uber, with an average age group of 16-24 years.

Source: Wikimedia

COVID-19 did impact the gig workers – both positively and negatively. Positive in the sense – more people began releasing the potency of the gig economy. The concept of “You are the boss and you are the company” resonated with a lot of people – especially after big organizations began laying off employees. The downside would be the lockdown sidelining a lot of gig workers. In short, it is safe to say that the Gig Economy is slowly, but surely becoming an integral part of the UK’s economy.

Cryptocurrency in the Gig Economy.

The staggering growth of Cryptocurrency has had a good impact on the gig economy. Nowadays, gig workers have started accepting cryptocurrency as a form of payment. From a different perspective, many see this as an opportunity to invest and take a bet on the Crypto world. I have seen many independent contractors splitting their form of payment into Crypto and Non-crypto for each month. This way, at the end of each month, they’ll have something on their Crypto account, and a set amount in their bank – for daily use. Apart from the hypothesis of saving, why do they prefer Crypto in the first place?

Applications of Cryptocurrency in the Gig Economy.

1. Effective means for payment processing.

Compared to the traditional financial system – Crypto is regarded as a safer and quicker means of transaction. With bigger companies showing more interest than ever towards Cryptocurrency – organizations that recruit freelancers, would be more than happy to transact using this digital currency!

2. Global access

Source: Wikimedia

With crypto in place, gig workers need not restrict their clientele to a specific geography due to the constraint put forth by the kind of currency.

3. Minimal to No transaction fee.

Though financial service companies like PayPal do exist, they charge a transaction fee for every international exchange made. On the other hand, the core benefit of Crypto is 0 intermediary – meaning gig workers need not pay any transaction fee!

4. Smart contracts

We have talked about smart contracts previously in our DeFi article. The reason for its popularity is the majority due to its seamless capability to create agreements between two parties. While an agreement itself is enough to keep gig workers feeling secure, smart contracts use blockchain technology to create it! Meaning once signed – it can’t be tampered with.

5. Collaboration

Although this concept might sound far-fetched, it doesn’t mean it’s not entirely possible. Decentralized Autonomous Organizations within the gig economy would help gig workers to form groups and work together. A gig worker can use Cryptocurrency for crowdfunding some of their projects – possibilities for collaboration are limitless.

Roadblocks

Source: Wikimedia

“It’s easier said than done” – you would hear this from most people if you explain the potency of Cryptocurrency. Financial Analysts, especially, are very careful when it comes to Crypto investments. However, it is justifiable as crypto very volatile when it comes to prices. A single tweet is enough for your currency to go down. The volatility would affect Gig workers when it comes to pricing. You don’t want to end up quoting a certain price while the contract is being made, only to note the prices going significantly down post your project. Yet another challenge that a gig worker might face would be the possibility of getting scammed. Crypto transactions are irreversible – once scammed it is nearly impossible to recover anything.

What’s next?

The gig economy is offering plenty of opportunities for workers and companies, alike. And there’s no denying that crypto would be the next big thing within this emerging economy. While there are a lot of benefits, there are certain challenges that might make Crypto a question mark. However, we have come a long way since we first placed a man on the moon. So, it is only obvious to state the fact that technology won’t stop evolving. Hence, it is only a matter of time until someone solves the potential roadblocks of Crypto. Once that is done, Crypto is going to have a huge role in the gig economy or the world economy in general!

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