A Japanese tech conglomerate called GMO Internet will be paying a portion of its employees’ salaries in bitcoin starting next month. The initiative is open to some 4,000 employees who, if they choose to, can receive up to 100,000 yen (that’s about $900 USD) of their income in bitcoin per month.
GMO Internet is a multifaceted company with diverse interests that include cloud computing and advertising technology, but it has been shifting its focus toward cryptocurrency for many months. The firm began operating a cryptocurrency exchange in May, and even started its own bitcoin mining operation shortly after that. It clearly wants to figure out how to best harness this technology to its own ends.
This bitcoin salary program lands somewhere between a company PR push and a cryptocurrency awareness campaign. Despite volatile fluctuations in bitcoin’s value, it’s hip and sexy for companies to publicly leverage the blockchain to different ends. Consider the iced tea company that merely changed its name to “Long Blockchain”—a marketing decision without technology behind it—and sent its shares skyrocketing.
This is an emergent pattern that’s starting to repeat itself. From vaporizer companies to pharmaceutical firms, numerous businesses are leaning on cryptocurrency to establish some cachet. GMO Internet’s efforts might represent the next level of mainstreaming “the money of the internet,” but at the same time, it’s yet another company chasing the next shiny object.
“We hope to improve our own literacy of virtual currency by actually using it,” GMO Internet spokesperson Harumi Ishii told the AFP in December.
The question of tax liability bubbles quickly to the surface. If employees are receiving untraceable digital money that holds real-world value, how do they represent that when tax time rolls around? If and when bitcoin salaries become more commonplace, laws around the world will modernize to reflect that. There will surely be income tax due on the value of one’s bitcoin salary at the time it was paid, and there may be capital gains liability if one’s bitcoin holdings should increase in value, suggests the BBC.
Bitcoin is a decentralized worldwide currency that’s controlled by no single individual, but by the crowd of people who perpetuate it. Governments can ban it, individuals can shun it, but the genie has been out of the bottle for nine years and shows no signs of going away.
Whether companies like GMO Internet jump on the blockchain bandwagon because they truly believe in the technology or because they want to be in the next big thing, these maneuvers work to bring a provocative technology to the surface.