Alo Yoga is going all in on crypto.
The yoga-wear and accessories brand, which owns stores and studios in major cities across the US, is allowing its corporate employees to convert part or all of their paychecks to cryptocurrency and will accept crypto as payment on its e-commerce website.
The moves, which precede the launch of an NFT collection timed with New York Fashion Week in September, is part of the company’s push to “move wellness into web3″ and make it easier for people to learn about and regularly use bitcoin, said Angelic Vendette, the brand’s vice president and head of marketing.
In accepting cryptocurrency as payment, Alo will join a growing list of fashion purveyors, including Gucci, Balenciaga and Farfetch. It is among the first in fashion retail to give its workforce the option to convert their earnings to cryptocurrency — something that companies in the tech sector have been experimenting with in hopes of attracting younger talent and drumming up awareness about the emerging investment category.
Alo’s big crypto play is coming at a volatile time, though, as the value of popular cryptocurrencies such as bitcoin and Ethereum are plummeting, and some crypto exchanges and services companies, including Coinbase and Bybit, have announced layoffs.
Alo Yoga’s employees who sign up will continue to earn their regular salaries in US dollars and the conversion to crypto occurs after they choose what percentage of their earnings will go into their crypto wallet. The remainder of the salary goes into the employees’ bank accounts.
In an internal survey, roughly 50 percent of its 350-member corporate workforce indicated that they would opt to receive at least part of their salaries in cryptocurrency. This week, they will be able to formally sign up for the benefit.
“[We] see this as a beautiful opportunity to help educate… our employees and give them the foundation to build their crypto wallets and their investment portfolios,” Vendette said. “We definitely know that web3 is going to continue to play a large part in all of our daily lives and so this is a wonderful way to start onboarding [people].”
As fashion retailers grapple with an ongoing labour shortage — as of April there were about 11.4 million job openings compared with 5.9 million people seeking work, US Bureau of Labour Statistics data shows — companies are getting more creative and offering unconventional benefits to attract and retain talent, said Jessica Ramirez, a senior research analyst at Jane Hali and Associates.
“It makes sense for [Alo] to do this,” Ramirez said. “Whether it’s education they’re offering or helping [people] invest in the futures [market] … the bottom line is helping employees gain financial stability can be attractive.”
As with any investments, there will be financial risks to the employees who opt-in. But the crypto market — with scarce regulations and no government backing — can be especially risky. For instance, had Alo’s programme been available a month ago, an employee who opted to convert their paycheck to bitcoin would find their investment was worth about 25 percent less today.
Cryptocurrency “doesn’t neatly fit into the boxes of existing statutes and regulations,” said Phil Bauknight, chair of the Fisher Phillips Cryptocurrency and Blockchain Taskforce, and companies will have to do their homework to find ways to mitigate legal and taxation risks to themselves and their workforce.
For one, businesses have to decide whether they want to pay employees in cryptocurrency outright or, as is the case with Alo, pay them in cash and have that converted into cryptocurrency via a third party payroll processor. The third-party route, said Bauknight, can reduce risks by “providing a vehicle for employers to remain compliant with… wage laws as well as tax and payroll obligations.”