Cryptocurrency trading in Latin America is growing 40% year-on-year with DailyCoin

Cryptocurrency trading in Latin America is growing at 40% per year
  • This year, five Latin American countries stand out in Chinalysis’ 2022 Global Cryptocurrency Adoption Index.
  • The increase in the use of digital assets has been dampened by high regional inflation, remittance benefits and the general search for higher returns.
  • Stablecoins have experienced great adoption in Venezuela and Argentina, as they are seen as representing places of value.

According to the ‘2022 Global Crypto Adoption Index’ published by blockchain analytics firm Chinalysis, cryptocurrency transactions in Latin America grew by 40 percent between July 2021 and June 2022.

The 2022 ‘Geography of Cryptocurrency’ report highlights that the region is the seventh largest cryptocurrency market in the world. At the time of the survey, residents traded a total of $562 billion worth of cryptocurrency.

Five Latin American countries in particular ranked 30th in the Global Crypto Adoption Index, with Brazil leading the way at 7th, Argentina at 13th, Colombia at 15th, Ecuador at 18th, and Mexico at 28th.

According to the research of Chainalysis, the crypto business in Latin America has moved mainly for three reasons: use as a store of value; its role in remittances; And better search through portfolio diversification.

With stablecoins and , Latin Americans are trying to prevent rising inflation. In Brazil, Peru, Chile, Mexico and Colombia, inflation of goods and services exceeded 12 percent in July this year, the highest in 25 years, according to data from the International Monetary Fund.

Venezuela and Argentina Swift Stablecoin Adoption

The economic situation in Venezuela and Argentina is very weak. Both countries have suffered not only inflation of 114 percent and inflation of 79 percent, but their currencies have been steadily depreciating against the dollar for years.

Therefore, investors across countries have turned to stable currencies as a safe haven against inflation and systemic collapse of their currencies. According to a MasterCard (NYSE: ) survey released in late June, at least one-third of those surveyed said they were making daily purchases with Statcoins.

The Chinalysis study also notes that remittances via crypto are on the rise in Latin America, albeit at different rates.

In Mexico alone, the remittance market is expected to reach $150 billion this year, with $51.6 billion generated through Bitso and other exchanges. Most of the families receiving these payments belong to the poorest economic sectors of society.

El Salvador is another country that regularly uses crypto payments for remittances through the government’s Chivo Wallet, which made $52 million between January and May 2022. However, the decline of Bitcoin and the low use of cryptocurrencies in the country has somewhat affected the payment of services. He gave up on the format.

Brazil has been the most enthusiastic Latin American country in adopting cryptocurrencies, with crypto exchanges, major banks such as Nubank, and various crypto trading services such as Visa (NYSE:) and MasterCard opening the country’s retail market in 2022.

On the flipside

  • According to a MasterCard study, 86% of surveyed Latin Americans are willing to use alternative payment methods such as cryptocurrencies, QR codes and biometrics, compared to 77% of Americans and 74% of Europeans.

Why should you pay attention?

  • Apart from the Mexican peso and the Brazilian real, Latin American currencies across the board have suffered major losses against the dollar this year.
  • The crumbling economic situation faced in these countries has contributed to the rapid adoption of cryptocurrencies and stablecoins in particular.

You can read other articles related to this topic at the following links.

NuBank is set to launch its own digital token, NuCoin, in strategic partnership with Polygon.

Comment: Why Bitcoin (BTC) Doesn’t Seem to Fight Inflation Well?

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