It’s no secret that Blockchain and cryptocurrencies, like bitcoin, have shaken up the way that we exchange money. The change is happening fairly slowly however as it enters into the everyday use of employers and employees, it’s easy to become overwhelmed by the concept. So how exactly will it change our financial transactions and, perhaps most importantly, will it change the way we work?
What is Blockchain?
Blockchain has been making itself known in the financial world for years now. Recently, you will have heard the words ‘blockchain’, ‘bitcoin’ or ‘cryptocurrencies’ floating around, but for the everyday person, the words can be confusing and many people are deterred from finding out more by the seemingly complicated technology.
In very simple terms, Cryptocurrencies are made possible because of blockchain technology. In essence, it’s just a financial ledger except that instead of being held by one centralised institution – like a bank – everyone who has the software has access to the ledger and is able to authorise transactions themselves, without the need for a financial institution to be involved. Bitcoin, along with other cryptocurrencies, is the currency that the Blockchain technology uses.
What difference is it really making?
Before Blockchain technology came into play, financial transactions all had to go through centralised institutions – that’s how many of us still handle our money today. The bank would handle the transaction, sometimes taking days and loading as many fees on top of the transaction as they could get away with.
The internet is a big player in these kinds of technologies and Blockchain is not that much more complicated than instant messaging, which took the power away from telcos. Instead of sending messages through a phone provider – which relied on the accessibility of their coverage and the cost of a text message – instant messaging allowed anyone to message anyone, anywhere. The cost was much lower than the telcos (only the cost of a split second of internet usage) and the messages were received instantly by anyone in the world.
That’s what Blockchain is doing for our financial transactions. Instead of waiting 3-5 days for the money to appear in your bank account, cryptocurrencies will appear in your ‘wallet’, on the same day, sometimes within the hour. The fees are minimal, particularly for overseas transactions – a big drawcard for many employers.
Not only is it quicker, cheaper and more convenient, Blockchain technology is actually making our financial transactions more secure. Instead of the ledger being held by one bank, the ledger is held by millions of people all over the world and every single person’s copy of the ledger has to match. To breach the system and be successful, one would need to simultaneously change every single copy of the ledger – a feat that is impossible to achieve.
So what does this mean for employers and employees?
Even with all the advantages of Blockchain technology, there is one advantage that stands above all the rest: it makes paying your employees a whole lot easier and quicker, no matter where they are located in the world.
This opens up a whole new way of working, for employers and employees alike. With Blockchain cryptocurrencies, the days of brick and mortar offices will drift further into the past. Flexible and global workplaces will become the norm.
The technology also makes it easier to hire the talent that will work for your business because you can hire the person you need, from absolutely anywhere in the world, without the barrier of hefty fees and transactions taking several days. For the employees, this makes your business an extremely attractive place to work – they can take up a position with your business confidently, knowing that they’ll get paid for their efforts, quickly. And, after all, a happy employee is a loyal employee.
As time goes on, Blockchain technology is creeping further into our daily lives. More and more businesses are accepting cryptocurrencies as payment. Now’s the time to break down the fear of the fancy terms and seemingly complicated technology and focus on what the technology can do for you and your employees.
For more information on how Pendragon Management may be able to help you in this global payment market…
We look forward to hearing from you.