As the world continues to embrace online transformation, both cryptocurrency and the digital nomad lifestyle have become more commonplace. The most impactful financial disruptor of the past decade, cryptocurrency has achieved remarkably high market caps due to widespread investment and adoption. Meanwhile, as remote working has gone mainstream, studies show that the digital nomad population has swelled by 50% since just the middle of 2020.
To some extent it's only natural to assume that as more digital nomads emerge – working anywhere and relying on the internet – they will rely on cryptocurrency designed to accommodate those very circumstances. But should digital nomads be particularly interested in adopting cryptocurrency?
In this post, we’ll discuss the pros and cons of crypto for digital nomads to see if it’s worth embracing.
Crypto is a versatile asset
Unlike fiat money, crypto works as both an investment and a means of payment. Because cryptocurrency is stored on secure blockchain technology, digital nomads can be assured that any assets they gather will be easy to access and use for either purpose. Plus, once digital nomads are familiar with working on the blockchain, it’ll be easier for them to diversify into other valuable digital assets.
Notably, digital nomad entrepreneur Olumide Gbenro is doing just this with non-fungible tokens (NFTs). Gbenro is opening a digital nomad resort in 2023 using funding from NFT sales. Described as a destination that will prove a “new model for distributed living," Gbenro’s concept highlights the potential and adaptability of virtual assets. Even if you aren’t planning to embark on the same scale of project, this illustrates that having blockchain-backed tokens like crypto opens up a world of interesting opportunities.
Crypto can be used for essentials
Whereas once upon a time cryptocurrency served only niche purposes, today it can be used to purchase a variety of products and services. Specifically, digital nomads have been able to use digital currency to pay for things like hotel rooms, meals, mobile data, and more.
Because crypto is also gaining traction as a globally recognized asset class, it can now also be used to purchase essentials like insurance. To further enhance tech-enabled solutions in healthcare and borderless work, Insured Nomads is partnering with CoverCompared.com to lower transactional costs of high-value insurance products bought via tokens like Ether, CVR, USDC,DOT, USDT, and DAI. Essentially, this means that nomads who hold cryptocurrency can enjoy specially designed insurance solutions without having to exchange or transfer fiat currencies.
Crypto cuts out the middlemen
One of the best aspects of cryptocurrency is its decentralized nature. This means that there's no third party that can control cryptocurrencies and charge fees.
As an added bonus, because anyone who invests in cryptocurrency can hold and manage it themselves, there is no need for multiple bank accounts. As has been explained by another digital nomad named Andy Sto, it’s generally not feasible to open multiple bank accounts while traveling. With crypto however, you can skip the bank altogether and simply manage your funds from your remote exchange or wallet in real time. Plus, because crypto doesn’t have to go through red tape, transactions are completed much faster.
Crypto can complicate taxes
Taxes can be tricky as a digital nomad relying on cryptocurrency, because related taxation rules differ by country. For instance, in some countries like the U.S., crypto is taxed as property. On the other hand, in the UK, any crypto transactions may incur income tax.
Because these considerations can be so complicated, digital nomads are often best off enlisting the help of a licensed accountant, just as many people in perfectly ordinary living and working situations do when tax season arrives. Having been trained in securities analysis and business law, accountants have an ability to decipher complex tax situations that the rest of us (digital nomad or otherwise) usually don't. Accountants who’ve passed the SIE exam can also determine how specifically to pay taxes on crypto dealings –– and can help digital nomads to do so without accidentally violating one law or another.
Crypto is not universally recognized
While several countries like El Salvador have started regulating cryptocurrency for widespread use, many others have not. Most notably, crypto is outright prohibited in China. Specifically, China and its financial regulators decided to ban all token trading and mining. For digital nomads, this means that all potential uses of crypto in China are now illegal – and unfortunately this is more or less the case in some other countries as well. Thus, if you’re planning on relying mainly on digital currency, you’ll have to exclude certain countries that don’t acknowledge (or allow) these assets from your travel plans.
So is cryptocurrency a good idea?
Despite being a volatile and speculative asset, cryptocurrencies can offer undeniable advantages. As digital nomads, it’s important to be agile and future-facing. This may include adopting assets such as crypto that are weaving a new era in finances, investments, and technology. Though they come with some difficulties, and present certain hurdles ,cryptocurrencies can be empowering for regular travelers when used responsibly.
Contributed by Scarlett Avery
About Insured Nomads
Insured Nomads is the first to take an integrated traveltech, fintech and insurtech solution to the world for remote workers, globally distributed teams, expats, and travelers. Their purpose is to make travel as safe and smart as staying at home. They do this by providing health insurance with exceptional medical benefits in tandem with wellbeing, safety, security, and advanced tech-enabled solutions for ease of payment for healthcare, emergency response and evacuation. Insured Nomads is available through affinity relationships, direct, embedded and through select brokers and partners for groups and individuals.
Information on integration, collaboration and partnership contact Brett Estep: email@example.com
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