Currently, many companies in the European Union are adopting cryptocurrency payroll, particularly on temporary work platforms or platforms that connect independent workers (Gig Platforms), as cryptocurrencies enable fast, efficient, and low-cost domestic and cross-border payments.
As this method has gained popularity in the European Union, new rules and regulations have emerged, along with an increase in the market share of platforms operating under European regulatory compliance. Below, we’ll learn what is required to comply with European regulations for using cryptocurrency payroll on temporary work platforms.
Rules and Regulations in the European Union
Companies wishing to use cryptocurrency payroll for temporary work platforms must comply with the regulations implemented by the European Union, including the MiCA regulation, the Platform Work Directive (Directive EU 2024/2831), and the General Data Protection Regulation (GDPR).
MiCA Regulation
Compliance with the MiCA regulation is essential, as these payroll systems use crypto assets. This requires platforms to hold European Union licenses, which will ensure a certain level of quality and transparency, in addition to protecting the consumer or end-user.
When a platform complies with the European MiCA regulation, it commits to monitoring transactions and verifying the identity of workers, which will help prevent money laundering and fraud. It is important to note that in the event of an ongoing investigation, companies must provide transaction records to the corresponding authorities.
Platform Work Directive (Directive EU 2024/2831)
The Platform Work Directive (Directive EU 2024/2831) is the regulation responsible for regulating, supervising, and guaranteeing the working conditions of individuals residing within the European Union, especially those who earn income through digital labor platforms, such as freelance marketplaces and other gig-based services.
Companies must clarify that the beneficiary is not an employee of the company, but rather a self-employed individual. This will clarify the relationship between the company and the beneficiary, increasing transparency in payment processes.
General Data Protection Regulation (GDPR)
The General Data Protection Regulation (GDPR) regulates how employees’ personal data is collected, processed, stored, and shared. This applies to any organization that handles the personal data of residents of the European Union.
In this way, not only are workers’ data protected, but it can also be ensured that the automation and algorithmic oversight within the platform are used ethically, preventing potential manipulation or misuse of the personal data of these independent workers or freelancers.
Segmentation of the Sharing Economy
Online work has evolved significantly, transcending geographical boundaries, traditional employment models, and technological advancements. In this context, the sharing economy has integrated cryptocurrency payroll as a key tool, especially in temporary work platforms that have adopted diverse labor models. These models enable work to be segmented based on the type of task, the degree of worker autonomy, and the level of control exercised by the platform.
Cryptocurrencies facilitate payments to workers across various segments, including freelancers and remote employees, thereby promoting financial inclusion. This approach is particularly valuable for those in informal or cross-border jobs, who often lack access to traditional banking. By implementing cryptocurrency payments, platforms not only streamline transactions but also expand economic opportunities for communities underserved by conventional financial systems.
Advantages of Crypto Payrolls: Stability, Speed, and Low Fees
One of the main advantages of cryptocurrency payrolls is their speed, which provides greater flexibility and versatility to the ecosystem, both for companies and freelancers.
While many cryptocurrency payrolls prefer to use popular or reputable cryptocurrencies, such as Bitcoin (BTC) and Ethereum (ETH), some freelancers opt for stablecoins (like USDC), primarily to mitigate the volatility of the crypto market and ensure the payment of stipulated salaries. Another advantage of this system is that conversion fees are lower, especially when converting these stablecoins to euros.
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