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Here’s something surprising. 41% of Brazilians either own digital assets today or have owned those in the past. This is according to a study done by Consensys and YouGov. And really, it is one detail that tells a whole story. Brazil is the largest country in South America. It has the 7th largest population in the world, and it is an influential part of the G7 rival, BRICS. According to a Chainalysis report, Brazil ranks ninth in global crypto adoption. In Brazil, crypto regulation is advancing, and adoption is growing. Exchanges (like Mercado Bitcoin) are being recognized by the government as payment institutions. And the first LATAM-focused Ethereum L2 blockchain ecosystem (Patex) is online.
There’s a good mix of potential in Brazil.
The retail market has always been open to the crypto world. Additionally, the government and regulators have been innovative in the FinTech space. The local market looks for new and disruptive technologies. They want to bring new solutions to society.
<h2 id="b-br-the-regulatory-landscape-b"> The Regulatory Landscape</h2>
It appears that Brazil is ripe for an explosion of crypto adoption, and the government’s role is going to be key.
On the regulatory side, the government has already taken important steps. But there’s more to do. The government body tasked with supervising the crypto industry is the Central Bank of Brazil. Several laws have come into effect. And at the very end of 2022, new laws created a “virtual service provider” license. They also established a crime of fraud involving virtual assets. New taxes are in place, and it is clear that the government’s role is critical on the path to mass adoption.
There is also a push underway for a Central Bank Digital Currency (CBDC). It is expected to launch in 2024. Some are excited about the launch. However, some fear that CBDCs will introduce government controls that could be harmful.
There are many possible benefits that will come out of a CBDC. Amongst them are the speed of transactions and transparency of government spending. Some of this transparency is, of course, dependent on how they build the CBDC. It is noteworthy that the blockchain ecosystem developed by Patex was built with a CBDC in mind.
<h2 id="b-br-pix-banks-b"> Pix &amp; Banks</h2>
One thing that makes Brazil unique is Pix.
Pix is the system the Central Bank of Brazil created to bring instant payments to the nation. It is popular. At least two-thirds of the country’s population have used it. And Pix is now the most common form of payment in Brazil.
And from a crypto point of view, Pix makes Brazil different.
Pix has accustomed huge portions of the population to a cashless financial system. This means that the instant payments offered by crypto are less of a novelty inside Brazil. However, it also means that huge portions of the population already have a digital wallet. The government is rolling out a CBDC. As they do, these digital wallets will become even more important. There will likely be overlap and conversion between Pix wallets and crypto wallets. This will increase the access to and demand for cryptocurrencies.
<a href="https://www.itau.com.br/" rel="noopener noreferrer nofollow">Itaú Unibanco</a> is the largest bank in Brazil.
Itau recently launched a crypto trading service for clients. This is in addition to other existing crypto services it already offers. Itaú is amongst a group of Brazilian banking and FinTech companies, like Nubank and Mercado Pago, that offer crypto services to clients.
There are a few crypto exchanges in the Brazil and the LATAM region. This includes Bitso (Mexico), Mercado Bitcoin (Brazil), and<a href="https://www.ripio.com/ar/" rel="noopener noreferrer nofollow"> Ripio (Argentina)</a>. Along with the Latin American crypto hub,<a href="https://patex.io/" rel="noopener noreferrer nofollow"> Patex,</a> these exchanges give people across LATAM access to crypto. Pix, digital wallets, financial institutional adoption, and exchanges. This is a powerful combination.
<h2 id="b-br-stablecoins-b"> Stablecoins</h2>
Here’s another piece of this puzzle.
What are people in Brazil actually using crypto for?
An overwhelming majority of crypto trading in Brazil focuses on one thing… USD-pegged stablecoins, specifically Tether (USDT). In 2023, USDT trading accounted for more than $50 billion in trading volume in Brazil.
Why?
Why are people in Brazil disproportionately using stablecoins?
The truth is that nobody actually knows.
Some think that the demand for USD-pegged stablecoins stems from the history of inflation. Others think that it could be Brazilian importers and exporters who are driving this usage.
Access to what is effectively US Dollars is a big deal for countries like Brazil. This is one of the ways that crypto is being used, and it is improving the lives of Brazilians.
<h2 id="b-br-what-s-next-b"> What’s Next?</h2>
It’s clear that a digital transformation is well underway in Brazil.
Pix is pervasive. Crypto Dollars are in huge demand. The government is creating a CBDC. Regulators are focused on using advanced tech in the financial space. There’s lots happening.
One thing that appears to have room for growth is education. Initiatives like the <a href="https://campus.patex.io/" rel="noopener noreferrer nofollow">Patex Campus</a> are important. Patex Campus provides individuals in LATAM with the skills required to understand and use blockchains and digital assets. But this is just the beginning.
More education, more building, more usage.
That’s the flywheel that Brazil is on, and there are so many exciting things to look forward to.&nbsp;
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Is Brazil leading the LATAM charge into Crypto?

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