Latin American Workers Are Opting for Payment In US Dollars and Crypto, Deel Says

Even amid the ‘crypto winter’, HR company Deel has reported a 27% increase in cryptocurrency withdrawals in Latin America over the past six months

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Bloomberg Línea — A growing number of companies are hiring in Latin America, with Argentina standing out as the main destination for companies to recruit remote workers, and many of whom are opting to receive payments in US dollars and even cryptocurrencies, according to Dan Westgarth, COO of payroll and HR platform Deel.

According to Westgarth, the adoption of cryptocurrencies is a growing trend in the region, with an increasing number of people receiving their salaries and payments in digital currencies. The shift towards crypto, even in a challenging scenario for digital assets, and the dollarization reflect a desire for more stability and accessibility in financial transactions, according to the COO.

In Latin America, Deel users withdrew over $100 million from the platform between March and April, using various methods such as PayPal, Payoneer, bank transfers, and Wise.

Additionally, Deel has recorded a 27% increase in cryptocurrency withdrawals in the region over the past six months. The platform operates with the Coinbase cryptocurrency exchange.

Another trend observed by Deel is the growth in demand for positions related to artificial intelligence (AI) worldwide, with a 461% increase in roles such as AI engineers, designers, managers and analysts between January and December 2022.

During the same period, the number of companies hiring for AI positions increased by 300%.

The Argentine case

Westgarth highlighted three distinct payment cases observed by Deel in Argentina.

First, the region’s banking system presents challenges due to transaction speeds, leading people to turn to cryptocurrencies for faster transactions. Secondly, there is a significant group of Bitcoin enthusiasts who allocate a portion of their earnings to cryptocurrency investments.

And thirdly, Argentines see cryptocurrencies as a hedge against inflation, choosing to convert their US dollars into stablecoins and invest through platforms like Coinbase to generate additional returns.

“In Latin America, we face challenges in payments, challenges in language and location, and challenges in regulation,” Westgarth told Bloomberg Línea, adding that ensuring timely payments to remote workers has become a considerable operational obstacle, especially given the variation in banking processes among Latin American countries.

Deel, valued at $12 billion, is in no rush to go public

Founded in 2019 by MIT engineering graduates Alex Bouaziz and Shuo Wang, Deel has over 2,000 employees worldwide across 100 countries. The company has experienced rapid growth, reporting $295 million in revenue in January 2023. The fintech has already raised over $630 million in external funding, including a $425 million Series D round in October 2021, and has a valuation of $12 billion.

According to PitchBook, an undisclosed investor sold a stake in the company to BAM Elevate for an undisclosed amount in November 2022.

With positive results and revenues growing alongside margins, Westgarth stated, however, that an initial public offering is not currently in the company’s plans.