This makes sense, because for its core believers, Bitcoin is “not an investment but an ideology,” Ortiz said. *Interviews with Samuel Gómez Milano and Eloisa Cadenas were conducted in Spanish and translated by co-author Maria Abreu.Bitcoin Embassy Bar isn’t the first business of its kind: There’s a coffee shop in Prague, a bar in Manhattan, and a burger joint in L.A. “There will always be migration, driven by the financial and labor disparities. is rich and Latin America isn’t,” says Gómez Milano. “The remittances market will continue to grow as long as the U.S. But remittances and high lending fees from the incumbents are not going anywhere, which will continue to incentivize crypto usage. Mass adoption has a long way to go, with the region representing between 5% and 9% of all crypto activity per month over the last year. Banks in Latin America are known for lending at high interest rates and charging exorbitant fees with APRs as high as 70% in countries like Mexico, compared to 5.9% crypto platforms like Nexo charge. The exponential growth of this platform proves that it is really helping ,” says Eloisa Cadenas, CEO of consulting firm CryptoFinTech and professor at the Mexican Stock Exchange Group.Ĭadenas believes this inefficiency provides ample opportunity for crypto exchanges to grow in the financial services industry. “In Mexico, Bitso made evident the advantages of using crypto for remittances. In comparison, the transfer cost via cryptocurrency is 0.1% and goes directly to the recipient in a matter of minutes. Direct account deposits can take up to five days. In 2020, amid the economic slowdown, remittance flows into the region remained largely the same compared to the previous year, at $96 billion.īanks like Western Union WU are the most expensive channel to send remittances, with an average fee of 10.9% per transaction, requiring the recipient to collect the money at an agent location if it’s needed immediately. Mexico alone took in $4 billion in remittances in March last year, up 35% from the year prior.
#Jungle mexican crypto bar drivers
Even though there’s a higher risk of getting scammed using these popular messaging apps, he thinks people prefer this method because crypto is still confusing to many, and direct communication helps bridge that information gap.ĭespite these challenges, remittances could be one of the main drivers of increased crypto usage. They prefer to find an experienced user with a good reputation, even when there are platforms like LocalBitcoins, Buda and Panda, because they think it’s easier,” says Gómez Milano. “WhatsApp, Telegram, Facebook Messenger, are the default channels people use to buy and sell crypto in Latin America. Instead of setting up their own crypto wallet through popular platforms, those interested in venturing into crypto prefer to find experienced individuals who already have a wallet and offer their services for a commission.
Mexico was the first country to enact a comprehensive fintech law in March 2018, but the legislation is ambiguous about crypto, providing a clear framework only for banks and fintechs’ use of virtual assets.Īnother disadvantage of crypto usage in the country is the economy’s over-reliance on cash, which accounts for 90% of all transactions, and a largely unbanked population. In Latin America, crypto is used primarily for speculation, trading and capital mobilization, driven by remittance needs, the devaluation of local currencies and expensive financial services.īut even though steep exchange rates and the constant devaluation of fiat or local currencies favor crypto adoption, there are still barriers to entry for new users, explains Samuel Gómez Milano, executive director and co-founder of CoinGroup, a Venezuelan research firm specialized in crypto and blockchain technology.Īccording to Gómez Milano, there is no overarching body that regulates crypto and blockchain-related financial services in the region. Click here to subscribe to Forbes CryptoAsset & Blockchain Advisor
0 kommentar(er)
