Wednesday, 19 June 2024

Crypto News

Latin America At The Forefront Of Crypto Adoption in 2023

Latin America Crypto

Cryptocurrency adoption in Latin America is on the rise, accounting for 9.1% of the global crypto value received in 2022 and totaling $562 billion from July 2021 to June 2022. This massive surge can be partially attributed to regulatory developments and institutional adoption. Authorities in the region are actively working on central bank digital currencies (CBDCs) and refining regulatory frameworks, bringing stability and clarity to the crypto landscape.

Latin American companies are also exploring blockchain technology’s potential to address regional challenges. Notably, Mercado Bitcoin issued Brazil’s first stablecoin, MBRL, in partnership with Stellar. Colombia plans to introduce its digital currency to enhance transparency and combat tax evasion, while cities in Argentina accept cryptocurrencies for tax payments to combat inflation. 

In what follows, we take a closer look at the key factors driving Latin America to the forefront of cryptocurrency adoption. 

Storing value against inflation 

Inflation has become a driving force behind the increasing adoption of cryptocurrencies in Latin America. In Argentina, where the inflation rate stood at 113.4% in July of 2023, cities like Buenos Aires and Mendoza have taken the progressive step of accepting cryptocurrencies for tax payments. Additionally, the Santa Fe Province is exploring crypto-mining activities to fund essential rail infrastructure upgrades.

Meanwhile, Venezuela, grappling with an alarming year-on-year inflation rate of 115%, has witnessed an astronomic rise in crypto adoption. Its national currency, the Bolivar, has depreciated by over 100,000% from 2014 to 2022. Amidst the unyielding inflation rates, Venezuelans have grown reliant on crypto as a store value. In 2022, for example, the country received $37.4 billion in cryptocurrency transactions, with 34% of these transactions involving stablecoins. 


Tokenization has emerged as another significant catalyst for crypto adoption in the region. Countries like Brazil have advanced in their Central Bank Digital Currency (CBDC) project, focusing on “asset tokenization.” This innovation involves converting real estate, stocks, and commodities into digital representations, streamlining transfers and enhancing asset liquidity.

The tokenization of financial assets, including corporate bonds and real estate debts,…

Click Here to Read the Full Original Article at CoinJournal: Latest Bitcoin, Ethereum & Crypto News…