From Where I Stand

as payment. When new blocks are added, new Bitcoin is released to cryptocurrency. I’ll bet you a Bitcoin, it won’t be the last. the miners who created the block. This will happen until a total of 21 Cryptocurrencies (or “cryptos”) have dominated the news the past million Bitcoin are finally mined and released. After that, that’s it. six months. Most recently, Dogecoin, a crypto developed as a That is the entire amount of Bitcoin on the market and its value will complete joke, based on a meme, featuring an adorable photo of a ebb and flow based on market demand. Shiba Inus dog, being promoted by an eccentric The other quirk is that cryptos fluctuate in value. billionaire who builds electric cars and rocket Yes, anyone who has ever used a foreign ATM on ships, reached a market cap of $80 billion. If vacation knows there are exchange rates. US dollars none of that sentence makes any sense, you are not are worth more or less, depending on the day, than alone. This is our economy, now. their international counterparts. However, the dollar

Finally, the currency of Ukrainian arms itself rarely surges and falls like an equity. Cryptos dealers, drug cartels, contract killers, dodgy constantly fluctuate. It is the marriage of a fixed asset billionaires, and stock trolls is going mainstream. and an equity. One month, a Bitcoin user’s wallet This column is going to examine what could be worth $100, the next month it could be worth cryptocurrency is, if your business should care $35,000 all with the exact same amount of Bitcoin. about it, and if your employees will care about it It all sounds complicated and insane. Yet, before you do. replace a few words and it sounds a lot like our

Cryptocurrencies started with the premise current system. Instead of dead presidents and that if you were to completely redesign currency queens, the money is covered in dogs and rocket to deal with a global, digital market, how should ships. I get it. We are more comfortable using it be done? We used to hunt and gather. Then we currency that flows out of nations with borders and bartered. Finally, we created coins and paper before Shave and flags and militaries. For now. those became ones and zeroes. Cryptocurrency may More and more businesses are accepting cryptos seem futuristic, but it is really a postmodern concept. When we used to barter, both parties walked a Haircut, as payment. Technologically, it is fairly easy to transfer cryptos using online apps from one wallet to away with items of utilitarian value. Money, on the other hand, has no actual value. Its value is .0000071 Bits the next. The buyer and seller transfer the requisite amount to seal the transaction. Crypto transactions entirely symbolic. It is merely a promissory note are irreversible. There is never an opportunity for provided by the buyer to the seller that says, one day, the value of the buyer to run to the credit card company to cry that utilitarian item that was just sold can be realized. On its surface, fraud or for the client to kite a check. Any business that has been money is a leap of faith, crypto is no different. burned by a chargeback knows the power that consumers have when

Let’s look at cryptos through the lens of Bitcoin. Bitcoin is the they cry foul. In addition, there are no credit card fees which is most famous and enduring of the cryptos. Bitcoin is the closest especially important when securing payment for a large ticket item. crypto to being a household name even though most households Finally, it diversifies payment options for clientele. don’t own any. Bitcoin actually leans closer to the original ideas I am sure every landscape company has worked for a few clients of monetary policy than the US dollar. Bitcoin is tied to a fixed where no one knows how they made their money and no one is cap of 21 million Bitcoins. That is its gold standard. It will never going to dare ask. Crypto is the currency of choice for keeping release more than 21 million Bitcoin to guard against inflation. As payments on the down low. A landscape company that accepts crypto of today, one Bitcoin is worth $43,000 US dollars. To put that into may be surprised at how many high-net-worth clients are parking perspective, in 2010, one Bitcoin was worth 8 cents. cryptos in offshore accounts due to the simplicity of moving money.

So how does it work? No one has ever held a Bitcoin in their The biggest drawback for businesses that accept crypto is that hand. No one has ever found one tumbling around the dryer at the the IRS treats crypto as property, not money. Therefore, the business laundromat. No one has ever skipped one into a fountain. Bitcoin needs to valuate the price difference between the day it was bought uses a decentralized banking model. Essentially, consumers who and the day it was sold and then pay capital gains on the difference. possess and accept Bitcoin agree that it has monetary value. Their Further, since crypto fluctuates, it would be best to cost the payment personal Bitcoins are tied to identification numbers, but those in US dollars and then accept the payment with crypto. If you cost numbers are entirely anonymous and transferable. the payment in crypto when a landscape job is bid, that fluctuation

An entirely digital currency opens itself up to fraud, hacking, could either massively increase or decrease the cost of the job in and manipulation. Bitcoin guards against this using a concept called even a few short months. blockchain, which is a global computer network that records the Lastly, there is already a currency for businesses who want valuation and transactions of Bitcoin. independent, decentralized to remain anonymous and keep as much money as possible from networks all agree on the current amounts and value of Bitcoin just the taxman. It is called cash. Most enduring and reputable landscape like your bank tells you how much money you have on a deposit businesses have moved away from all cash payments. There is simply receipt. These blocks are constantly pinging data back and forth as too much risk. I don’t see the unscrupulous end of the market accepting the monetary system is always in flux. crypto when cash is available without the technical complexity.

As the system grows, the need for more blocks in the Blockchain As of today, with the small number of consumers using crypto, becomes apparent. People who set up these blocks are called miners. there does not seem to be much need for small businesses to change Miners create new blocks that then become part of the Blockchain. payment operations beyond cash, check, or charge. As crypto These miners are incentivized to do this by receiving new Bitcoin matures, that will certainly change. The Landscape Contractor June 2021

Now, let’s examine crypto and your employees. The Fair Labor Standards Act does allow for salaries to be paid in crypto as long as the proper taxes have been withheld. With that said, the State of Illinois, along with a number of other states, forbids earnings to be paid in anything but US currency. As of now, employers cannot pay any portion of earnings in crypto. In the same breath, Illinois is actively recruiting Blockchain employers and I would be surprised if the state sticks to its guns on barring crypto paychecks. Crypto presents a fascinating option for employees who are risk tolerant and willing to subject their salary to the whims of the market. Remember, the employee in 2010 who accepted 5 Bitcoin worth 40 cents is now sitting on $215,000.

Now, here is the interesting quirk about crypto that directly pertains to the landscape industry. American banks and financial networks hate crypto. This makes sense because the entire world revolves around the US Dollar. This is not the case internationally.

One of the most accepting and consumer-friendly countries towards crypto is Mexico. There are a number of reasons for this. Over 55% of Mexicans do not have a bank account especially among Mexico’s working class. However, almost every Mexican has a smart phone and a surprisingly robust broadband network. There is deep distrust in the Mexican banking system among its people. In addition, every year $25 billion are wired to Mexico from workers in the US. Every time a worker sends that money, he or she has to pay a transaction fee, not to mention go through the hassle of setting up a money transfer.

Crypto has eliminated the middleman and allows for simpler transfer of money. Mexican fintechs like Bitso have made it easier to convert crypto to pesos at over 140,000 gas stations and convenience stores. Although Illinois law forbids employees to be paid in crytpo, landscape employers can communicate to employees who send money home how to use crypto instead of traditional wire transfers.

Mexico’s lesson of working-class adoption of crypto is one not to forget in an industry with a massive Mexican working-class population. Consumers lean towards crypto because traditional banking leans against small net worth consumers who cannot speak English. Crypto is a far better alternative than a world of wire transfers, currency exchanges, and predatory lenders. Often, a lack of a bank account pushes reliable landscape workers into the shadows. The ease and discretion of crypto can solve many of these challenges.

We can all pretend we are patriotic nationalists, but our purchasing habits reveal the exact opposite. We are motivated by accessing products and services cheaply, efficiently, and quickly. International borders and national pride will not stand in the way of that. Our current system of money is fine, but as global marketplaces replace national and territorial ones, it creates opportunity for a worldwide currency. Clearly, no one country would ever trust another to develop this global currency so the private sector will need to take up the slack. As the world slowly updates its institutions, savvy consumers can profit from speculation. It may be a half decade before a business has to look hard at crypto, but there are 43,000 reasons (and climbing) for why it’s worth a second glance.

Scott Grams, Executive Director May 19, 2021