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Getting Paid in Bitcoin

Added 05-16-22 06:21:02am EST - “Unfortunately, an automatic crypto purchase made with after-tax earnings won't lower your taxable income.” - Reason.com


Posted By TheNewsCommenter: From Reason.com: “Getting Paid in Bitcoin”. Below is an excerpt from the article.

During the last year, several professional athletes and two big-city mayors announced that they would take a portion of their salaries in bitcoin. If you get paid via direct deposit and are bullish on bitcoin, you too can turn your salary into satoshis. (There are 100 million satoshis in a single bitcoin.)

For most of us, getting paid in bitcoin doesn't mean our salary is denominated in bitcoin. Rather, it means your employer directly deposits part of your fiat-denominated paycheck into a bank account connected to a crypto exchange, which then uses the money to purchase bitcoin and deposits that amount into your crypto wallet.

Coinbase, the most widely used cryptocurrency exchange, rolled out this direct deposit function in late September. Users can print the direct deposit paperwork from Coinbase's website and send it to their employers or, if the employer contracts with any one of several large payroll processing companies, set up direct deposit entirely online. They can then choose to have a specific dollar amount from every paycheck, or a percentage, converted to bitcoin or any of several other cryptocurrencies.

The basic process is not novel. Investment companies such as Vanguard and Fidelity allow customers to directly deposit their paychecks into brokerage accounts. Some people have their paychecks divided and direct-deposited across traditional checking and savings accounts, or even accounts at different banks.

The new option might sound like buying crypto yourself, but with extra steps. "In my opinion it's probably just marketing," wrote one member of the r/Bitcoin subreddit in November. "Oh this famous athlete is getting paid in Bitcoin and endorses whatever exchange. His fans might follow and buy bitcoin on that exchange bringing in revenue for that exchange."


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