Cryptocurrencies had a great year in 2021. In this period, we have seen the market go from being classified as a billion-dollar economy into a trillion-dollar economy. Aside from that, cryptocurrencies are gaining visibility in the mainstream world with, for example, El Salvador's adoption of Bitcoin as the official digital currency. As a result, investors are looking for the "new Bitcoin" on the market, hoping to find a great alternative in so-called altcoins. Unfortunately, many traders value an altcoin exclusively…
Cryptocurrencies are designed with sophisticated encryption and are part of a decentralized cash system. This means that cryptocurrencies are secure, only available in digital form, and don’t have government interference.
As the world moves towards an eco-friendly existence, this kind of paperless transaction is quickly gaining popularity. Millions of people have already started using this currency for their business transactions. A study estimated that there are more than 5.8 million active cryptocurrency wallets.
Many people in different industries are accepting cryptocurrencies, and it seems that freelancers are on board as well. Handling accounts and keeping track of payments as a freelancer can be challenging. Fortunately, cryptocurrencies can cater to any freelancers’ financial needs. The currency is making accounting and transactions a much simpler experience for these independent workers.
Keep reading to find out how these digital coins can work for you.
Features of Cryptocurrencies
- They exist in digital form
Cryptocurrencies only exist in digital or virtual form. They aren’t tangible, like the traditional currencies we are all used to. Cryptos don’t have physical banks where they are stored and can only be accessed through the internet on your devices like computers.
However, this does not mean the currency isn’t ‘real.’ Just because you can’t physically touch, it doesn’t mean it’s not there. That said, cryptocurrencies are kept in digital wallets, which help you conduct your transactions online.
- Their network is decentralized.
The traditional currencies and cash systems we deal with daily use a centralized system in that an organization, the bank, or the government controls these currencies. Cryptos exist across a network of computer servers and don’t depend on one central server. They are free from the control of any central authority.
Their network relies on a peer-to-peer system that regulates the transactions made. The crypto owner can directly send cryptocurrency to other users without interference or need for intermediaries. The transaction is then recorded in a public ledger where network users can view it.
- Transactions are permanent
Once the transaction has gone through and has been recorded on the ledger, there’s no going back. They are permanent and unchangeable, preventing fraudsters from taking back their money after services are provided.
- They use sophisticated encryptions.
Encrypting data helps secure the information in code that can only be accessed or decoded by specific people. Therefore, encrypted cryptocurrency is secure with a verification process that records transactions associated with the currency.
Most cryptocurrencies guarantee anonymous transactions. The encrypted codes allow you to stay anonymous when making sales to ensure your privacy is protected.
Benefits of Cryptocurrency to Freelancers
Using cryptocurrency in your business transactions has already proven beneficial to many investors. Several start-up blockchain businesses have started catering to freelancers to ease the process of transactions. When we looked at the cryptocurrency features, we covered some benefits like irreversible transactions and being fraud-proof.
However, these benefits go even further, and they include:
- Personal management of transactions
As stated earlier, cryptocurrencies use a decentralized network that doesn’t depend on third-party involvement. You are solely responsible for managing how you receive and send payments. It’s a beneficial little perk in that your funds are less likely to be diverted somewhere else without you being aware.
It eliminates the risk of being cheated out of payments by fraudulent employers.
- Fast-tracking of payments
The lack of a centralized system managing your transactions ensures that you can keep an eye on your funds by the second. Unlike banks that take days to track payments, cryptocurrency can be tracked faster, with payments being delivered even instantly in some cases.
Payments for service delivery don’t get caught up in the centralized system chain of bureaucracy.
- Efficient global transactions
If there’s one perk of using cryptocurrency for your business transactions, it’s the fact that it’s borderless. Cryptocurrency enables you to make international transactions without worrying about your location. You also don’t have to pay the fees for foreign transactions like you would when using traditional currency.
Your client base just got broader and cheaper when using cryptocurrency.
- Cheap transaction costs
We’ve already mentioned how cryptocurrency removes the need for foreign transaction fees on your payments. Furthermore, cryptocurrencies usually have lower transaction fees compared to other currencies. The central authorities that often demand these fees, such as the government, don’t exist in crypto, and therefore, your transactions aren’t charged exorbitantly.
- Protected privacy
Different cryptocurrencies offer varying levels of privacy to the owners. If you need to remain anonymous throughout a transaction or receive payment, some cryptocurrencies are made to cater to that.
As the workforce shuns the traditional nine to five jobs and leans towards becoming freelancers, there is a growing need for a platform to help them manage their accounts. This is especially important to freelance workers who deal with clients from foreign countries and all their different currencies.
With this and other little quirks specific to the freelance world in mind, we consider using digital currencies for transactions.
Cryptocurrency has features that are sure to cater to every financial need of this type of worker. It is designed to eradicate the daily worries that freelancers go through, such as late payments or reversed payments by fraudulent employers. Having a non-traditional job deserves a non-traditional form of currency and payment to go along with it.