Anuja Nadkarni is a business reporter covering immigration, small business, employment and private tertiary education.
A buoyant job market is giving crypto asset holders more confidence to change their jobs or leave altogether.
Easy Crypto chief executive Janine Grainger says this year she’s been hearing more stories from customers cashing in huge earnings to quit their jobs or their business.
“Just this morning a customer contacted me to cash out $500,000 worth in cryptocurrency and he put in $13,000 in January this year. He definitely made some good choices,” she says.
Easy Crypto’s customer base grew fivefold following the first lockdown in March 2020. The value of Bitcoin has taken a wild ride this year – after hitting a high of US$69,000 (NZ$100,000) earlier this month it dropped to US$60,000 last week.
“We’re familiar with QR codes, shopping online Zoom meetings thanks to Covid. I don’t get asked ‘is Bitcoin even real?’ anymore.”
Earlier this month a survey of 1000 workers in the United States conducted by research firm CivicScience revealed 11 percent resigned or know someone who resigned from their jobs due to the financial freedom afforded by digital asset trading.
The majority of respondents who quit or knew someone who quit because of their crypto asset were earning a salary less than US$50,000 (NZ$72,000).
In New Zealand, the Financial Services Council’s Rise of the Digital Investor report published earlier this year shows one in five were investing or previously invested in cryptocurrencies, an increase of about 7 percent since March last year. The majority of investors are in their 20s and 30s but Grainger says in the wake of the pandemic, more customers in their 50s and 60s have been investing in cryptocurrency.
“They have better financial literacy than younger customers and understand the importance of diversifying assets. There is also a bit of concern with global financial markets. There’s been a lot of quantitative easing, printing of money, and growing inflation and low interest rates meant funds in the bank are potentially going down in value, not increasing.”
Grainger says there are a number of ways to earn passive incomes from cryptocurrency that range in risk. She says lending is one of the most popular modes of earning a passive income.
Essentially investors can lend their cryptocurrencies to different borrowers earning interest payments in exchange. Borrowers use digital assets as collateral for loans, which can be sold to cover the cost of the loan incase of a default.
“Similar to lending via a bank, but just removes the intermediary and instead of being controlled by a bank is controlled by code,” Grainger says.
There is also crypto mining, the process through which the currency like bitcoin is entered into circulation. The computer programmes complex computational math problems and the first miner to find the solution to the problem is rewarded with bitcoins and the process begins again. Staking is another mode that involves completing network tasks like validating transactions for rewards.
AUT human resources management professor Jarrod Haar’s 12 year old son is a Bitcoin miner.
While he is skeptical of quitting your job and investing in cryptocurrency, he says workers that have built a decent nest egg from investing in crypto assets may feel more comfortable switching jobs or taking a break in an employment market facing a severe labour shortage.
The record resignations reported month on month in North America is being labelled the ‘the great resignation’ is being driven by a number of issues, including pandemic fatigue, burnout and overall job dissatisfaction. Women are also leading this trend, perhaps unsurprisingly as McKinsey & Company’s 2020 Women in the Workplace report showed women have borne the brunt of the family responsibilities during the pandemic.
Haar says the introduction of vaccine mandates has also further complicated the employment market as workers refusing to get vaccinated are leaving jobs exacerbating the labour shortage in some industries.
But for those looking to return to the workforce, Haar says knowledge in cryptocurrency may improve a candidate’s prospects in the job market.
Haar says a survey he conducted of 1000 workers found less than a quarter reported having a meaningful job.
“There’s a lot of people out there who aren’t getting a heck of a lot of meaning from their jobs. And maybe the Covid’s just made them reevaluate.
“Talking the talk to the right person about your crypto knowledge could help you get a job. If you’re a math teacher refusing to get vaccinated, you could leverage that expertise in teaching people about cryptocurrency.”