We tend to be sceptical when we hear about anything involving paying artists in cryptocurrency. It’s usually the domain of blockchain startups, with the twist usually being that there’s no immediate way for the artists to convert that cryptocurrency into ‘fiat’ cash.
However, this week’s news that distributor UnitedMasters is going to offer a crypto-payouts option thankfully swerves some of the pitfalls.
For a start it’s optional: artists can choose to be paid fully in US dollars still. It’s also a partnership with Coinbase that means if they do choose to be partly or entirely paid in crypto, it will be in the currency of their choice, rather than a token that isn’t available to trade on exchanges. It’s part of Coinbase’s push to get more companies paying their employees this way: “We want to make it easy for every company to pay employees in crypto. This is the future of payroll,” as the pitch goes.
Volatility is the issue for artists to think about. At the time of writing, $1k is worth 0.000018 bitcoin, but in mid-July, it was worth 0.000034 bitcoin. If an artist had chosen to be paid their royalties in bitcoin then and held on to the cryptocurrency, they’d be worth 47% less now. Get paid in crypto at a low point before it bounces up, and you’re laughing, but it still feels like a gamble.