In recent months, the cryptocurrency market has shown a bearish sentiment, with encrypted prices falling to annual lows. This is causing some blockchain companies to rethink their business models and reduce their employees.
However, the crisis did not stop the blockchain industry from experiencing a human resources boom, as evidenced by the active growth of job offers associated with blockchains and digital resources, according to the latest study conducted by the Glassdoor recruitment site.
Increased demand for work related to the blockchain
As estimated by LinkedIn analysts, 645 vacancies marked with the words "blockchain", "Bitcoin" or "cryptocurrency" were published on the website in 2016. In 2017, this figure rose to around 1,800 and 4,500 vacancies in mid-May of this year. As of now, LinkedIn's search system shows 13,816 blockchain-related records and 2,479 cryptocurrency records.
These estimates are supported by recent data published by the Glassdoor recruitment portal. As of August 2018, US companies have published 1,775 vacancies related to blockchain technology, which is three times higher than in the previous year.
As noted in the Glassdoor report, 79 percent of vacancies are concentrated in the 15 largest US cities and regions with the most saturated demand show that New York and San Francisco account for 24 percent and 21 percent of the total number of cryptographic jobs openings. The current total number of blockchain and cryptocurrency jobs worldwide has grown to around 3,000 and 900 as a result.
Software developers are the most demanded employment, with 19% of job vacancies posted by employers looking for employees who fall into this category. In addition to programmers and engineers specializing in cryptography, there are missing product managers, risk analysts and marketing experts.
Traders and investment analysts are not among the most sought-after professionals in the cryptography industry. But there are more and more vacancies for specialists in new disciplines that have appeared in the wake of the popularity of blockchain technology: "Decentralized Finance", "Decentralized Internet" and "Security Hardware".
However, if the last three months are taken into consideration, a more complete picture appears to be partially different. According to the extended analysis shared by the job search platform In fact with Cointelegraph, from October 2017 to October 2018, the interest in the work roles related to Bitcoin, blockchain and cryptocurrency decreased by 3%, while The employer's interest in roles related to the same terms only rose (25.49%), which was different from the levels of interest compared to the previous year by both parties.
If you look at the data from 2016 to 2017, the interest for job seekers for roles related to Bitcoin, blockchain and cryptocurrency has increased by 481.61%, while the interest of employers for related roles on the same terms it has increased by 325%.
The following chart shows both the growth of interest in jobs looking for jobs with these keywords and the growth of job offers for jobs with these keywords for that period of time.
Today, IBM, ConsenSys and Oracle have the greatest need for qualified personnel. Each of them has more than 200 matching jobs, as reported by Glassdoor. They have become strong competitors of industry leaders such as cryptographic exchanges, including Coinbase and Kraken most in need of qualified personnel. The list of key employers for blockchain professionals was also joined by large consulting firms Accenture and KPMG. At the same time, one could note the lack of vacancies linked to blockchain by giants such as Facebook, Google and Apple.
The need for experts in the encrypted sector is not a uniquely American phenomenon. In August, Cointelegraph reported a 50% increase in the number of vacancies associated with blockchain and cryptocurrency in Australia, India, Singapore and Malaysia compared to 2017. At the same time, developers who are familiar with the Python programming language are among the most desirable candidates.
"Half a million dollar jobs" and "crazy" packages
The lack of qualified personnel means higher salaries for blockchain specialists. As estimated by Glassdoor, the average basic salary for such employees is $ 84.884 per year. This is 62 percent higher than the average salary in the United States ($ 52,461 per year). At the same time, the variation in salaries ranges from $ 36,046 for junior developers to $ 223,667 for qualified software engineers.
Blockchain developers with 3-5 years of experience can earn "half a million dollars" annually, according to the Blockchain Developers recruitment agency. At the same time, analysts suggest that newcomers can count on a "well over $ 120,000" salary.
The company executives also noted the increase in wages in the blockchain and cryptocurrency sectors. According to David Schwartz, chief cryptographer of Ripple, the hiring packages have "gone crazy" since "ICO have downloaded a lot of money for the industry". In particular, a couple of Ripple developers have received "$ 1 million bonus offers", revealed Schwartz.
In particular, the current average salary of Ripple's software engineer is $ 125,000, as estimated by Glassdoor. Given that the same job was paid $ 85,000 in May 2018, according to Paysa, it does not appear that the prices of crypto in the market affect the wages of developers, at least not to Ripple.
Some employers attribute the decline in the quality of products produced by developers to rising wages. According to Alex Ferrara, partner of Bessemer Venture Partners, which invests in cryptographic funds, such "overcrowding" is "influencing the pace of development." Many of these projects are far behind in their launch programs. "
The current realities of the blockchain industry have been continuously battered by a decline in the cryptocurrency market, which is partially responsible for the shrinking of personnel shortages. Since raising funds through ICO has become more accessible than crowdfunding, qualified specialists prefer to launch their own projects and start assembling their development teams, as in the case of Amber Baldet. The leader of the blockchain group of JPMorgan Chase left the company on April 2 to start their project. As a result of these "forks" within companies, the lack of personnel is becoming increasingly acute.
Who needs salaries in the crypt?
The popularity of cryptocurrency also grows as a means of remuneration, albeit not as rapidly. On 17 September, the startup HR Chronobank published the results of its survey on 445 killing enthusiasts from around the world, including the United States, Australia and Russia. Respondents were asked in which currency they preferred to receive salaries.
Two-thirds (66%) of them said they were ready to get paid for work in Bitcoin or other cryptocurrencies. The majority (83%) of respondents said they were in favor of receiving digital cash bonus payments. Among the people interviewed, 72% said that, choosing their next job, they would prefer an employer to offer the possibility of paying wages in cryptocurrency.
One fifth of the respondents said they would exchange cryptocurrency, perceived as wages, for traditional money. In particular, half of the respondents believe that if they receive a salary in cryptocurrency, they will spend less than they do now.
The results of the latest survey conducted by the peer-to-peer (p2p) Humans.net platform have shown the high level of interest and availability of US citizens to be paid in cryptocurrencies. Eleven percent of 1,100 freelancers replied that they would like their salaries to be paid in digital money, and 18 percent expressed a desire to receive part of their wages in encryption.
Today, wages in cryptocurrency are popular especially in the sector. On 18 August, the publisher of TechCrunch Michael Arrington tweeted that Binance CEO Changpeng Zhao told him that 90 percent of the company's employees preferred to receive a salary in the platform's native token, Binance Coin (BNB).
In December 2017, GMO Internet, a Tokyo-based IT giant, announced its plans to start paying cryptocurrency wages. The company intended to pay up to 100,000 yen ($ 884) of monthly salaries of over 4,000 Bitcoin employees. Bitcoin.com also offers its employees the opportunity to get paid in Bitcoin Cash, given information from job openings found on its website.
However, the payment of wages in cryptocurrency goes beyond the sector. In August, the semi-professional football club "Gibraltar United" announced plans to pay its players a salary with a cryptocurrency called Quantocoin. Club owner Pablo Dan believes that the use of cryptocurrency offers greater transparency and, above all, simplifies financial relations with foreign players playing for the club. Experts believe that wages in cryptocurrency will help international companies attract foreign specialists from a distance.
"Several US-based companies are paying their international workers in Bitcoin, as they can save both the company and employee money," Bloomberg Law analysts suggest. According to statistics published on the company's website, almost 200 companies use Bitwage, a service that allows employees and freelancers to receive cryptocurrency payments. As estimated by Bloomberg Law, approximately 65% of Bitwage customers are US companies and 95% use it to pay salaries to international workers.
Current statistics, found on the Bitwage website, show that over $ 31 million has been paid to employees by companies through this service. Among the customers mentioned there are Google, Facebook, Uber and Airbnb.
For some people, cryptocurrency payments become more than a new way of doing transactions. Workers in regions such as Latin America, which may not have a mature banking system or a stable currency, have the option of being paid in cryptocurrencies. For example, developers in Venezuela have had more business opportunities and revenues with the advent of Bitcoin. However, receiving salaries in cryptocurrency may result in a tax debt.
The main obstacle to widespread cryptocurrency wages remains the lack of clearly defined legislation, including tax rules. Today, regulatory approaches from different countries and their views on the taxation of digital money vary widely.
There are no special rules for the regulation of digital money activities in the European Union and the taxation of encrypted transactions is governed by the national legislation of each country. As a result, in France, digital currencies are subject to capital gains taxes, with commissions of 14-45%. Germany does not charge any tax as long as the cryptocurrency is used as a means of payment. Bitcoin does not have a consolidated legal status in the United Kingdom, but is commonly regarded as a foreign currency for most purposes, including value added taxes and goods and services.
Asian countries offer a different approach to the taxation of activities related to encryption. In Singapore, if the digital currencies are part of the taxpayer's investment portfolio, the profits from the sale are not taxed, since they are considered capital gains. In particular, Bitcoin is recognized not as money but as a service, therefore a tax is levied on goods and services (similar to local VAT). In China, cryptocurrency transactions are subject to income tax and capital gains and revenues are subject to taxation. Japanese people are charged 15 to 55 percent for any Bitcoin-related business.
In Australia, cryptocurrency transactions are subject to income tax. In Canada, they are subject to income tax and capital gains tax, with a maximum of 50% of the revenue charged. In the United States, cryptocurrency owners pay taxes on digital money as they would do with property.
Blockchain in recruitment
Because blockchain technology and cryptocurrency create new jobs, business models that are dependent on third-party involvement may become obsolete. The bottom line is that smart contracts – decentralized and digitized business agreements – control the fulfillment of obligations by all parties and manage all essential financial flows. As a result, third-party services of various types of intermediaries may no longer be required.
Meanwhile, mediation services constitute a large segment of the modern economy. After all, in traditional contracts used by banks, brokers, authorities, real estate agents and others, it is the intermediary that describes the terms of the transaction, drafts the document model, controls the execution of an agreement and appropriates a significant part of the payment.
Smart contracts automatically coordinate and guarantee the interests of all parties, almost instantly and for free. Furthermore, the impossibility of modifying the information in the blockchain provides the highest level of security to all participants in the transaction, eliminating the possibility of manipulation and deception of data. In essence, an intelligent contract can replace a room full of corporate lawyers, real estate agents, recruiters, risk managers and other professionals whose work is essentially reduced to the formal evaluation of documents.
In addition to regulating business relations within the company, blockchain technology can become a magic pill for the freelance industry. Over the past two years, the scope of distance work across the world has increased significantly and the sector should continue to expand. The former US Secretary of Labor Robert Reich calculated that in a couple of years 40% of the US workforce will be a freelancer. However, this could lead to a number of problems as freelancers are not considered full-time employees, which means they remain outside the health insurance, pensions and other social benefits.
Moreover, they are forced to use the services of aggregator sites, which focus mainly on the interests of the client, and not on the freelancers themselves. In addition, such platforms like Upwork charge up to 20% for an invoice and payments for work done are often delayed.
Some projects take advantage of blockchain technology to solve the problems currently affecting the independent economy. Some provide freelancers with a service where blockchain is used to guarantee paid leave and sickness benefits when needed. Other solutions offer a blockchain-based system to resolve disputes between customers and professionals. Some platforms are implementing the Blockchain-based Human Resource Bank to enable p2p matching of potential employers with contractors based on verifiability of all user data and excluding the possibility of forgery.
The use of blockchain technologies in social networks and websites for freelancers demonstrates the strong demand of the sector for new solutions that use advanced technologies and cryptocurrencies. The exclusion of intermediaries, direct communication, reputation systems is what the blockchain brings to the world of work.
The pace of development and the integration of blockchain and cryptocurrency into everyday life will probably depend on the position and attitude of national governments. Countries with a friendly position on cryptocurrency are already leaders in the use of blockchain technology.
Florida residents pay property taxes, driver's licenses, identity cards and car numbers in cryptocurrencies – Bitcoin and Bitcoin Cash – using the BitPay payment system. The related decree was approved by the State Tax Department.
In the meantime, in 2017, China banned the trading of cryptocurrencies, ICOs and the exchange of cryptocurrencies, and the result was a decuplication of the circulation of cryptocurrencies. According to the country's central bank, the share of the yuan in the Bitcoin market has fallen from 90% to 1%, and 88 crypto exchange and 85 blockchain startups that had operated in China since the fall of 2017 have left the country. Under such conditions, even numbers of those wishing to receive a paycheck in Bitcoin may gradually decline.
Another factor that can affect the adoption of cryptocurrency in the labor market is the price of the digital currency. As of now, most cryptocurrencies are volatile, and this dramatically cools workers' enthusiasm for payroll payments in digital currency.
As the sector continues to develop, mature and adhere to government regulations, the number of workers who choose to receive their salaries in Bitcoin, Ether and other cryptocurrencies may become increasingly common. Raj Mukherjee, Indeed's senior vice president of products, told Cointelegraph:
"While in recent years, in fact, I have seen a steady increase in the interest of job seekers for roles related to cryptocurrency, our data show that job searches for these roles have increased when the cost of Bitcoin was at its best, and since then, interest in job seekers has diminished, but remains strong. "
On the other hand, the demand for specialists able to solve specific tasks will grow. Stephane Kasriel, CEO of Upwork, said:
"In just a few years, more than 30 percent of the essential skills of the workforce will be new, and we are seeing the change taking place on Upwork, where new and emerging skills such as blockchain emerge on a monthly basis."
Large companies like IBM and Microsoft have been willing to invest in the long-term blockchain by expanding their hires in the last year. The trend in mid-2018 will probably continue to move to smaller companies, as experts predict. Although the total number of applications submitted by job seekers decreased by 3% over last year, the continued decline in cryptocurrency prices did not affect the interest shown by companies seeking blockchain specialists.