The US government has been slow to develop a comprehensive framework for regulating crypto. The general lack of clarity around the treatment of digital assets has resulted in a new wave of issues for crypto firms. 

As the SEC set into motion a series of high-profile crackdowns this June, in reaction, crypto companies and exchanges across the US have begun the search for more crypto-friendly soil to base their operations. 

Crypto Exchanges Contend with SEC Lawsuits 

After the SEC filed a lawsuit against Coinbase in June, alleging that the crypto exchange violated federal securities laws, and issued 13 charges against Binance in the same month, crypto companies expressed growing frustration due to the increasing regulatory scrutiny in the absence of clear regulations. 

In a statement issued by Binance in response to the SEC’s allegations, the global company operating the largest crypto exchange stated:

“Binance has found itself an easy target caught in the middle of a U.S. regulatory tug-of-war.”

In the wake of harsh crackdowns by the SEC with threadbare regulation to back their claims, many crypto companies have become skittish about maintaining operations in the US. This issue is twofold, involving the need for a clear regulatory framework to be developed while concurrently generating apprehension and uncertainty regarding the eventual shape of these regulations. 

The response from many US-based crypto companies and organizations working within the web3 space has been to offshore HQ.

How to Offshore HQ While Employing American Workers 

On the heels of the mass exodus of crypto companies off of US soil, the question of how to hire and retain US employees has taken center stage; relocating to avoid the potential for entanglement in a regulatory battle should not come at the cost of having to dissolve a well-established workforce. 

In the midst of these complex legal situations, delegating compliance and adherence to labor laws to an EOR is the most efficient and straightforward way to transition operations overseas. 

EORs, or Employers of Record, are professional service providers that assume the responsibility of being the official employer for a company's workforce in a foreign country or jurisdiction. They handle a wide range of human resources and employment-related functions, including but not limited to payroll processing, tax compliance, benefits administration, and employment contracts. 

In the case of companies offshoring HQ while maintaining a US workforce, EORs provide key support to enable a seamless transition. 

EOR Services and Offshoring

Stepping into the role of legal employer, EORs provide invaluable assistance when it comes to compliance assurance, local expertise and payroll management. 

EORs are integral for mitigating the legal risks associated with moving business operations to a foreign jurisdiction. They assume the responsibility of navigating the intricate web of local labor laws and tax requirements, thus ensuring a compliant transition. 

The experts with regard to both local and global regulations, EORs provide insight into cultural nuances and best practices. They are the go-tos when it comes to all questions regarding labor practices abroad including hiring, compensation, and HR policies tailored to the specific region.

While payroll can be complicated enough when operating out of one’s home country, issuing compliant payments internationally is a far more difficult task. EORs handle a company’s payroll, including currency conversions if necessary. This ensures that all employees are paid accurately and on time, across different time zones.

Compliant Offshoring with Rise 

Rise is an all-in-one payroll and compliance solution that provides EOR services to help companies seamlessly offshore their operations. From hiring to payouts, Rise streamlines HR processes while ensuring full compliance on a local and global level. 

The Rise Pay platform enables companies to efficiently verify contractor identity and compliance in minutes in over 150 countries while automating instant global payouts in fiat and crypto. 

With Rise’s flexible routing infrastructure, companies can fund payroll in the currency of their choice, from crypto in a digital wallet to fiat in a traditional bank account, and contractors can withdraw payouts in their preferred currency, across 100 cryptos and 90 fiat currencies. 

All operations conducted through Rise are guaranteed to be fully compliant, adhering to local labor laws and tax withholdings. Rise offers an array of EOR services that include, but are not limited to, KYC checks, automated Professional Service Agreements, and compliant global payouts. 

Schedule a demo today to learn how Rise’s comprehensive EOR services can help to seamlessly transition your headquarters offshore.