Latin American countries are major players in the crypto boom. The region, with a population of approximately 650 million people, shows a market ripe for crypto boom.
The number of people using bitcoin and cryptocurrency, the new decentralized system, is exploding in certain countries. With the use of new mobile applications, new trading sites, new exchanges, new ways to exchange and use bitcoin, the number of transactions has been steadily increasing.
Mobile Decentralized applications (Dapps)
There are many mobile applications that help store, manage, and transact in cryptocurrency. The evolution of the financial market is clearly evident in Latin America.
The cause of immense interest is driven from the economic and financial crisis the region has faced. Each country has faced its own financial system collapse and are driven towards alternative systems that are not controlled by the government. Here is a breakdown of each country in Latin America:
El Salvador has made bitcoin a legal form of payment as of June 9, 2021. By passing a bill that will allow all businesses to accept the use of bitcoin for commerce. As of right, now the US dollar is the fiat currency. The emergence of bitcoin as payment will increase demand, transactions, and usage. El Salvador became the first country in the world to formally adopt bitcoin as currency and means of payment. Bitcoin will have 10 million potential users entering the digital markets, making bitcoin the currency of the future.
Brazil’s crypto industry is currently unregulated. Retail investors are fueling the demand for crypto in the country. There is a large community of day traders looking to make a profit. Brazil is the largest economy in Latin America. The economy has been at risk since the beginning of the COVID pandemic. With the economic slowdown and instability caused by the pandemic, the institutional and retail investors are seeking crypto as a better alternative. This year, Brazil’s Securities and Exchange Commission approved a Bitcoin ETF. In addition, Brazil’s stock exchange B3, has taken steps to approve one of the world’s first Bitcoin exchange-traded funds, ETF. The ETF will be listed in June. This will allow investors to invest in Bitcoin and other cryptocurrencies as a new asset class. The ETF’s are largely driven by institutional investors’ demand to invest in bitcoin. At the moment, the crypto investments seems to be growing at a staggering pace. The interest in crypto will continue to grow as more companies invest in the ecosystem.
Colombia is emerging as one of the fastest growing crypto markets, driven by young retail investors. There is immense interest in Bitcoin and cryptocurrency investment. Colombia ranked fourth in the world for Peer-to-Peer bitcoin trading volume. Cryptocurrency demand is surging due to tech savvy millennials. Colombian traders are highly active in the market. The crypto ecosystem is thriving and growing rapidly. The Colombian government so far, has not laid out any extensive regulatory framework for cryptocurrency. Further allowing the Bitcoin ecosystem to grow. In addition, Colombia also has the highest number of bitcoin ATMs in a Latin American country. People have access to these ATM’s at major cities allowing for frictionless transactions and no middlemen. Like with any technology, accessibility is the key. So far Colombian government has been open to innovation and technology. Bitcoin and cryptocurrency adoption will continue to increase in the region, allowing more people to participate in buying, selling, investing, and trading.
Paraguay taking inspiration from El Salvador announced it is taking an interest in adopting bitcoin into its monetary ecosystem. As mentioned on Twitter on June 7 2021, Carlos Rejala, a Paraguayan Congressman, said that Paraguay is embarking on a new project.
The future of cryptocurrencies in Latin America is evident in the number of daily peer to peer transactions taking place. A system that does not rely on the banks or government entities and allows financial freedom. In time, the South American region will emerge as the technology and innovation center.
Venezuela has been leading the crypto revolution in Latin American for many years. The economic and financial crisis has caused the Venezuelan people to seek alternatives to fiat currency. As the currency faced hyperinflation, leading to a massive depreciation in fiat currency value, leading people to store money in bitcoin and other cryptocurrencies. The volume of daily peer-to-peer transactions is driving commerce. Venezuelans no longer see it feasible to transact in a deflating currency and prefer to use cryptocurrencies. To them, Bitcoin and cryptocurrencies are a far better option then fiat currency. They can easily transfer funds without institutions controlling their funds. Many are employed and paid in cryptocurrencies such as Bitcoin Cash. The crypto community is also involved in mining bitcoin, due to cheap electricity cost, as a means to make money and survive the economic situation. Cryptocurrency has emerged as a way for people to transact, buy goods, and trade. Small merchants, small cafes and shops, to large merchants, and international brands in Venezuela, all accept digital payments. It is also used as a remittance for families to send and receive money from families. Another popular cryptocurrency, Dash, has been popular in the country. Many businesses accept Dash as a form of payment because it is easy to use and instant. You can buy food, groceries, services, accommodations, and more using Dash. At the moment, Venezuela has a strong footprint in the digital economy and is creating a better future with cryptocurrencies.
The Latin American countries are leading the way for a better financial future by investing in technology and innovation. The countries have been resilient even during the most devastating economic crisis and forging a path ahead. Latin American region is at the forefront of crypto adoption.
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