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Bitso Launches Stablecoin, Backed By Mexican Peso for Latin America

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  • Juno will issue and manage MXNB, a stablecoin pegged to the Mexican peso.
  • The stablecoin operates on Ethereum’s Arbitrum for efficient payments.
  • Juno Mint Platform offers APIs for businesses to manage MXNB transactions.

Bitso, a top cryptocurrency exchange in Latin America, has launched its stablecoin operations through the new subsidiary, Juno. The subsidiary aims to issue and manage digital assets such as stablecoins, with Mexican peso stablecoin (MXNB) as its first token. Bitso introduced its stablecoin business to enhance cross-border payments and financial transactions.

Bitso Launches Mexican Peso Backed Stablecoin

Juno will issue the MXNB stablecoin that is fully backed by the Mexican peso through a one-to-one exchange ratio. The token operates on the Ethereum layer-2 network Arbitrum to boost performance. The MXNB stablecoin enables Latin American businesses to make faster, cheaper, and more transparent cross-border payments compared to traditional financial methods.

Juno launched the Juno Mint Platform to support stablecoin adoption across their network. The Mint Platform provides APIs and tools that enable business operations such as the issuance, redemption, and conversion of MXNB. The platform connects users to the Mexico SPEI banking system, which facilitates easy transactions between stablecoins and traditional currencies.

Increased Stablecoin Adoption in Latin America

Bitso launched its stablecoin operations amid the increasing demand for digital assets in Latin America. Latin America experiences economic challenges such as high inflation and currency devaluation, which have led to the high cryptocurrency adoption in the region. Stablecoins provide solutions to these issues because they act as a reliable store of value.

Juno’s stablecoin, MXNB, enables global businesses to operate in Latin American markets. Bitso’s head of stablecoins, Ben Reid, explained that MXNB could cut down problems related to conventional cross-border payments. The stablecoin presents businesses with a low-cost transparent solution that simplifies market entry into Latin American markets.

Stablecoins have witnessed increased adoption across Latin America because of remittances and a shift to cryptocurrency-based financial solutions. Mexico is the second-largest country in international remittances because it receives billions of dollars from the United States each year. This has increased interest in cryptocurrency such as stablecoins because they offer a reliable means of payment.

Besides Juno’s stablecoins, Tether’s MXNT and MMXN have achieved substantial success in the Mexican stablecoin market. However, Juno’s MXNB stablecoin stands out because it is fully backed by Mexican pesos, which provides users with enhanced stability. The increased adoption of stablecoins could reshape the payment sector in Latin America, especially in countries with currency volatility issues.

Argentina Tops $91B in Crypto Inflows, Edging Out Brazil in Latin America

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  • Argentina surpasses Brazil in Latin America’s crypto inflows, highlighting its growing crypto market.
  • Stablecoins play a vital role in protecting citizens in Argentina amid high inflation and currency devaluation.
  • Centralized exchanges dominate Latin America’s crypto activity, driven by institutional and professional investors.

Argentina has become the top nation in Latin America for estimated crypto inflows, surpassing Brazil. According to Chainalysis, the region received nearly $415 billion in digital currency from July 2023 to June 2024, just over Eastern Asia. During this period, crypto inflows in Argentina are valued at an estimated $91.1 billion, while Brazil covers around $90.3 billion.

This surge is part of a wider trend, with Latin America now the second-fastest-growing crypto region in the world, having enjoyed a 42.5% YOY growth in this activity. Argentina, Venezuela, and Brazil contribute much toward that boom, impelled by increased digital currency usage for everything from remittances to a hedge against inflation.

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Source: Chainalysis

Stablecoins: A Lifeline for Argentinians

The high inflation rate of Argentina, reaching around 143% by the middle of 2023, shifted many residents toward refuge in digital currencies, mainly stablecoins pegged to the U.S. dollar. With the growing devaluation of the Argentine peso, the demand for these stablecoins has increased, and people are using them as a hedge to preserve their small savings. According to the Chainalysis report, attached with the downfall of the Argentine peso, there has been a jump in stablecoin transactions.

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Source: Chainalysis

Stablecoin transactions of less than $10k represent retail transactions in Argentina more than any other digital currency. This would mean that Argentinians use stablecoins to hedge their assets against the inflationary pressures they face. Stablecoins accounted for nearly 62% of the accumulated crypto transaction volume in the Argentine nation, showing that these instruments are important in the economy.

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Source: Chainalysis

Institutional Crypto Activity Grows in Brazil

While Argentina leads in the overall inflows of crypto, Brazil is seeing a resurgence in institutional crypto activity. Major financial players in Brazil have grown interest in digital assets, increasing the value of institutional-sized digital currency transactions by 48.4% from Q4, 2023 to Q1, 2024. The growth has been attributed to portfolio diversification and regulatory developments, such as the introduction of Bitcoin and Ethereum ETFs.

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Source: Chainalysis

Interest in stablecoins, especially for cross-border payments, continues to mark the shifting landscape in Brazil. Transactions in stablecoins account for about 70% of flows from local exchanges to international platforms. Circle, one of the largest operators of stablecoins, strengthened its presence in Brazil, pointing to good regulatory policy as a key driver of growth.

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Source: Chainalysis

Related Reading | UN Endorses Ripple and Stellar for Global Payments Network

Binance Boosts Latin America Crypto Adoption

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Binance’s recent launch of its new platform, Send Cash, marks a significant move towards enhancing crypto accessibility and adoption in Latin America. The platform allows for efficient transfer of digital funds through licensed providers in nine countries, including Colombia, Honduras, Guatemala, and Mexico. This development comes in the wake of Binance discontinuing its crypto card payment program with Mastercard across several countries, signaling a strategic shift in the company’s focus.

Send Cash stands out for its reduced transfer costs and increased speed, addressing common pain points associated with cross-border money transfers. In its initial stage, users in these nine countries can send funds to bank accounts in Colombia and Argentina, hinting at the potential expansion of services to other regions and currencies.

Min Lin, Binance’s Regional Vice President for Latin America, emphasized the platform’s contribution to financial inclusion and the broader adoption of cryptocurrencies in the region. This move aligns with Binance’s commitment to fostering crypto-related innovation and its desire to integrate digital currencies into everyday life.

Binance’s Strategy Shift: Send Cash’s Impact

Latin America’s growing interest in cryptocurrencies, particularly in the face of economic challenges such as inflation, is noteworthy. The rise of pro-crypto figures like Javier Milei in Argentina underscores the increasing prominence of digital currencies in the political and economic discourse of the region.

Beyond Binance, other major players are also making strides in the Latin American crypto landscape. Stablecoin issuer Circle’s collaboration with Mercado Pago, a major payments company in the region, reflects the trend of integrating cryptocurrencies into mainstream financial services. Additionally, Num Finance’s plans to tokenize remittances with a stablecoin pegged to the Colombian Peso could potentially revolutionize cross-border transactions in the region.

Binance’s decision to introduce Send Cash shortly after ending its partnership with Mastercard signals a strategic realignment. While the specifics behind this move are not provided, it demonstrates Binance’s adaptability and commitment to refining its offerings based on market dynamics.

As Latin America continues to grapple with financial volatility and limited access to traditional banking services, the introduction of platforms like Send Cash could catalyze the broader adoption of cryptocurrencies. The ease, speed, and cost-effectiveness of these services can potentially drive financial inclusion and economic empowerment for individuals and businesses alike.

In conclusion, Binance’s launch of Send Cash in nine Latin American countries marks a progressive step towards increasing crypto adoption in the region. This move aligns with the broader trend of integrating cryptocurrencies into mainstream financial services and addresses real-world challenges faced by residents in these countries. As the crypto landscape evolves, initiatives like Send Cash could play a pivotal role in shaping the future of financial transactions in Latin America.

Binance Suspends Crypto Debit Card Services in Latin America and Middle East

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Binance’s decision to suspend its crypto debit card services in Latin America and the Middle East, effective August 25th, has been announced without divulging the precise rationale behind the suspension. Binance did, however, assert that the impact of this suspension would be limited to just 1% of users within the affected regions.

Operating akin to conventional debit cards, the crypto debit cards facilitated the payment for everyday goods and services, albeit with the distinction that these cards were funded using cryptocurrency assets.

Binance
Binance Suspends Crypto Debit Card Services in Latin America and Middle East 7

The termination of crypto debit card services in Latin America and the Middle East is slated to be finalized by September 21st. Notably, this exchange has stipulated that reimbursement processes and the handling of disputes will remain operational until December 20th, 2023.

The emergence of this situation was triggered by an inquiry from a user on the X platform (previously known as Twitter) regarding issues related to crypto debit cards in Colombia. Binance’s response to this inquiry came in the form of an announcement, indicating the impending suspension of debit card services commencing August 25th, albeit without shedding light on the specific factors influencing this decision.

In April 2020, Binance initially unveiled its strategy to introduce debit cards supported by cryptocurrencies, with the objective of establishing a presence in the global payment sector. By July 2020, these cryptocurrency-backed debit cards had begun to be dispatched to various European nations and other locations around the world. Subsequently, this exchange formed a partnership with Swipe, a payment processing company, with the intention of extending the availability of these crypto debit cards into the United States.

Binance Offers No Clarity on Suspension

According to a report, In an attempt to gain insight into the potential reasons for the suspension of its crypto debit card services in Latin America and the Middle East, contacted Binance. Regrettably, the exchange declined to furnish this information. Nevertheless, in response to inquiries, this exchange did confirm that the impact of this suspension would be confined to a small percentage of its user base, specifically less than 1% of users within the aforementioned markets.

Despite Binance’s assertion that only a minor fraction of users would be affected by this course of action, a few of the statements made by Binance CEO Changpeng Zhao on the X platform (formerly known as Twitter) regarding the announcement and the ensuing discussions were subsequently removed.

Bitfinex Strives For Financial Inclusion With Its New P2P Feature In Latin America

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Bitfinex has rolled out a peer-to-peer exchange servicing clients focusing on Argentina, Venezuela, and Colombia. The launch is aimed at boosting financial freedom and inclusion, the firm said in a statement.

“By offering a reliable and efficient platform for P2P token trading, we are empowering our customers to engage with the marketplace in a way that affords maximum convenience based on their needs and preferences,” Bitfinex CTO Paolo Ardoino stated.

Users will be able to transact directly with one another outside of the Bitfinex platform by buying and selling Bitcoin [BTC], Tether tokens [USDt and EURt], Tether Gold [XAUt], and Ether [ETH]. 

Later this year, the exchange will also introduce a smartphone version of Bitfinex P2P, along with other features targeted at improving the user experience.

For those new, a P2P service enables two parties to communicate directly and on their own terms without the intervention of a third party.

Once seen as the backbone of the crypto ecosystem, peer-to-peer trading has come under intense pressure as a result of heightened regulatory scrutiny.

One of the earliest P2P exchanges known to exist, LocalBitcoins, announced its closure on February 9, 2023, after ten years of operation.

Two months later, Paxful, another prominent peer-to-peer crypto exchange with more than 11 million customers, announced its temporary suspension.

CEO Ray Youssef cited key staff exits and regulatory challenges in the industry as reasons behind the decision. 

Bitfinex’s P2P Might Bridge The Gap Left By Others

The departures of the two leading players were a huge setback as P2P platforms have been crucial in fostering the growth of cryptocurrency usage, particularly in developing countries, and in providing financial services to the unbanked.

With its most recent step, Bitfinex hopes to increase access to financial services related to digital assets in Latin America and fill the gap left by the closures of P2P exchanges LocalBitcoin in February and Paxful in April.

Last year, Bifinex in collaboration with leading stablecoin issuer Tether and Hypercore, a peer-to-peer data network announced the launch of a fully encrypted video-calling application dubbed Keet.

The free video-calling app employs peer-to-peer connections to facilitate real-time audio/video calls, text chat, and file sharing.

The new feature is powered by an innovative technology called Distributed Holepunching that allows users to find and connect to each other using only cryptographic key pairs upon authorization. 

Unlocking The Crypto Craze: Latin America & The Caribbean Ride The Digital Wave

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Latin America and the Caribbean (LAC) are becoming hotspots for cryptocurrency adoption, with countries in the region exploring the potential of central bank digital currencies (CBDCs) and grappling with the challenges posed by crypto assets. 

Varying Approaches To Crypto Asset Regulation

A recent paper released by the International Monetary Fund (IMF) sheds light on the diverse approaches taken by LAC countries and emphasizes the need for effective regulation and transparency.

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While El Salvador made headlines by adopting Bitcoin as a legal tender, other LAC nations are focusing on CBDCs as a means to enhance financial inclusion, improve payment systems, and reduce cross-border remittance costs. 

The Bahamas led the way by introducing the Sand Dollar, and the Eastern Caribbean Currency Union and Jamaica followed suit. Brazil is also making strides with its CBDC project, aiming to facilitate the transfer and liquidity of various assets through asset tokenization.

Interestingly, several Latin American countries, including Brazil, Argentina, Colombia, and Ecuador, ranked among the top 20 globally in terms of crypto-asset adoption. 

These countries are attracted to the potential benefits offered by digital assets, such as protection against macroeconomic uncertainty, improved financial inclusion, and faster, cheaper payments. 

However, the adoption of crypto assets also brings significant challenges, especially for vulnerable economies with a history of instability, corruption, and weak institutions.

Regulation of crypto assets varies across LAC countries. While El Salvador has embraced Bitcoin, other nations like Argentina and the Dominican Republic have banned their use due to concerns about financial stability, tax evasion, corruption, and money laundering. 

El Salvador’s experience highlights the risks associated with unbacked crypto assets, as Bitcoin is still not widely accepted despite its legal tender status.

Effective adoption of stablecoins, which aim to maintain a stable price relative to a specified asset, also presents challenges. 

Meta’s pilot project, designed to enable fee-free domestic and cross-border payments in the US and Guatemala, faced regulatory pushback and potential currency substitution risks. The project was ultimately wound down in 2022.

CBDCs offer promising solutions to these challenges. Many central banks in LAC are exploring the introduction of CBDCs, viewing them as tools to enhance payment systems, promote financial inclusion, and preserve monetary sovereignty. 

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Retail CBDCs, designed for the general public, are seen as particularly beneficial for integrating the unbanked population and countering the adoption of stablecoins and crypto assets.

To manage the risks associated with crypto assets, the IMF suggests an appropriate policy response that balances regulation and innovation. 

Instead of outright bans, the region should focus on addressing the drivers of crypto demand, including citizens’ digital payment needs, while improving transparency by recording crypto asset transactions in national statistics.

Nevertheless, Latin America and the Caribbean are witnessing a dynamic landscape of digital currencies. While some countries have taken bold steps like adopting Bitcoin, others are exploring the potential of CBDCs. 

Effective regulation, transparency, and addressing the underlying drivers of crypto demand will be key to harnessing the benefits of these technologies and ensuring long-term stability and financial inclusion in the region.

Related Reading | Global Stablecoins Could Soon Come Into Existence: Japan’s Banking Giant

Bitcoin Futures Secures Entry In Latin America

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For the first time in Latin American history, the Bitcoin Futures Index has received regulatory approval in Argentina.

Local media reports stated that the BTC futures contract would initially start trading in May on the Matba Rofex exchange after receiving approval from the National Commission of Value [CNV], the country’s securities regulator.

According to the post, the aforementioned index will be calculated using data on the price of Bitcoin provided by various price sources, organizations that support the functioning of the BTC / ARS pair, and deposits of Argentina pesos made by bank transfer.

The regulator’s approval is part of a strategic innovation goal that was established in the first quarter of 2022, the article read.

…intends to adapt to the regulatory challenges imposed by new technologies for the provision of financial products. As well as promoting the development of new and innovative products by its regulated subjects in the capital market.

Also, CNV established the requirements for exchanges for the nation’s provision and usage of payment services.

Exchanges based in Argentina must have a working agreement with a payment services provider or PSP that is authorized by the BCRA, the Central Bank of the Argentine Republic.

By trading derivative goods under-regulated market infrastructures, qualified investors will be able to have exposure to Bitcoin price fluctuations in a secure and transparent manner, it stated.

Moreover, CNV has asked its authorized crypto trading platform Matba Rofex SA to include alerts intended for the investing public that warn about the dangers of this activity and potential outcomes in the conformation of said instrument.

Amidst the nation’s soaring inflation, its peer-to-peer Bitcoin trade volume has risen to new heights. This opens a wide range of opportunities for crypto assets as people tend to seek out a better store of value.

Many advocates of crypto even argue that this is a counter-inflationary asset.

Bitcoin’s Addition Will Revolutionize Developing Economies

The biggest digital asset exchange in the world, Binance, recently announced plans to increase its presence in Argentina. The post claimed that Binance will make it possible for Argentinians to buy and sell digital assets using their own pesos.

The news holds significance for the inflation-stricken Argentina peso and demonstrates the necessity for a decentralized, crypto-based financial system to better control inflation.

There is a growing push to remove reliance on inflated local currencies in favor of a crypto-based financial system as developing economies like Argentina struggle with economic issues brought on by ineffective central bank policies.

Coinbase’s Big Bet On Latin America’s Largest Crypto Brokerage

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U.S. cryptocurrency exchange Coinbase Global Inc is inching closer to a major acquisition deal of 2TM, owner of Latin America’s largest crypto brokerage Mercado Bitcoin. As per a report by a local newspaper O Estado de S.Paulo, the agreement would be finalized by the end of April. However, the news outlet did not disclose the source of the information, adding to its mystery.

The report also mentioned that Coinbase was pitching the idea with Mercado Bitcoin beginning in 2021, as part of its larger effort to expand its operations in the increasingly competitive market. As of now, Coinbase and 2TM made no comment on the development.

Last year in July, Mercado Bitcoin, a Latin American digital assets exchange, has raised $200 million in Series B funding from the SoftBank Latin America Fund. The round enhanced its parent firm 2TM Group’s valuation to $2.1 billion, ranking it among the top 10 unicorns in Latin America. 

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The report further noted that the Brazilian crypto unicorn would help Coinbase gain the necessary leverage required to secure a market leader position in Latin America. Besides Mercado, Coinbase was also eyeing Mexican crypto exchange Bitso as an acquisition target, but apparently, no deal was reached, the newspaper said.

In November 2020, Coinbase announced the creation of an engineering hub in Brazil and opened different positions to expand its team there. Brazil and the other Latin American nations with their large online population, a growing pool of talented developers, and the desire to improve their situation provide a fertile ground for crypto and web3 to take root.

It is not surprising why many crypto bigwigs are making a beeline in the region. In fact, Coinbase’s major rival Binance is on a hunt for similar acquisitions in Brazil, the newspaper said.

Coinbase’s Competitor Binance too gaining inroads in the Brazilian Landscape

Just a few days ago, Binance CEO, Changpeng Zhao, a.k.a CZ announced that the global crypto exchange will be establishing a base of operations in Brazil’s most populous city, Rio. CZ stated that the move is a direct result of an agreement he reached with the city’s mayor during his visit nine days ago where he was also offered a key to the city.

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Latin America: New collaboration eases millions of investors for crypto to fiat transactions

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Latin America jumps ahead with its new collaboration, which will provide seamless crypto to fiat transactions. Wyre has announced an alliance with the Stellar network, which will allow local Brazilian and Argentinian currencies to be efficiently onboarded into digital assets. Due to the integration, Wyre is expanding its operation throughout Latin America, allowing developers and companies interested in using cryptocurrency to simply expand into new countries and consider new forms of payment.

The conversion of many worldwide currencies into cryptocurrency has always been a pain in the ass. Still, Latin America has a robust cryptocurrency infrastructure, making it desirable for businesses and innovators to flourish. Furthermore, the combination of Wyre and Stellar will allow for finance in one of the most rapidly growing cryptocurrency sectors to be liberalized and increased access to digital money through a more secure infrastructure.

A little glimpse about WYRE

Wyre is the crypto ecosystem’s top fiat-to-crypto and payment infrastructure, provider. The firm focuses on developers, providing simple-to-integrate APIs that allow thousands of developers to bring crypto to the people. Since its creation, the firm has “on-ramped” over 15 million end-users to its partners and handled over $10 billion in payments. Wyre’s main product, “Checkout,” is the world’s quickest fiat-to-crypto gateway and has assisted hundreds of crypto apps in reaching their target audiences.

“Building the cryptocurrency infrastructure to be more accessible is critical, especially as cryptocurrency becomes a more popular form of payment.”

 Erich Grant, director of business development at Wyre

This integration will use Stellar’s robust SEP-24 protocol to enable easy and secure value transfers across the network at a fraction of the cost of traditional payment rails. It will allow users to access Stellar’s network and anchors via Wyre’s API and Widget to convert Brazilian Reals and Argentine Pesos into various digital assets.

Latin America and crypto adoption

Latin America was always far ahead of others with regard to adopting and accepting cryptocurrencies. The region always tried to provide a flexible ecosystem for crypto to flourish. It is also home to El Salvador, which was one of the early adopters of Bitcoin as a legal tender.

This is just the beginning of the earliest stages of crypto adoption. With each country and government following the bandwagon, it’s difficult to overlook how far the crypto ecosystem has risen.

Latin America’s bitcoin profile on the rise thanks to Mexico and El Salvador

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Bitcoin has been making its way further into the mainstream this year as the price of the flagship cryptocurrency has soared. While the price is off its peak of more than USD 63,000, the bitcoin bulls are still optimistic about the trajectory of the market for the near future. A couple of key catalysts for the bullish outlook are stemming from the Latin American region. In Mexico, one cryptocurrency startup just achieved unicorn status, while El Salvador is looking to make bitcoin legal tender.

In Mexico, a bitcoin trading platform called Bitso has recently attracted USD 250 million to its coffers in a funding round that catapults the startup’s valuation above USD 1 billion, giving it the coveted and rare unicorn status in the country.

Given the emerging nature of the cryptocurrency and blockchain space, being crowned a unicorn is a major achievement and a testament to the willingness of venture capitalists to direct funds in the direction of the bitcoin market. El Salvador, meanwhile, has become the talk of the town after announcing that it wants to make bitcoin a legal payment method.

El Salvador’s Bitcoin Push

El Salvador has been a bright spot in the cryptocurrency market even as the bitcoin price has fallen from its highest level of the year. During a bitcoin conference in Miami, Fla. in early June, El Salvador President Nayib Bukele became the main event when he announced via a video that the country is looking to make bitcoin legal tender.

The government has teamed up with Chicago-based blockchain startup Strike to prepare the payment infrastructure for the shift to digital currencies. President Nayib touted the adoption of bitcoin as legal tender as key to streamlining the process for the Salvadoran diaspora living abroad to send remittances to households in their home country.

Remittance payments are a major part of the country’s economy and represent almost one-quarter of its GDP, affecting some 360,000 families. Migrants sent USD 5.92 billion in remittances to El Salvador during the pandemic year. The flow of money transfers to Salvadoran families slowed down at the height of the pandemic, mainly April 2020 when remittances plummeted 40%, before picking up again mid-year.

El Salvador’s bitcoin push is facing some potential regulatory hurdles from the very organization that it looked to for help during the height of the pandemic. The International Monetary Fund (IMF) is not sold on the Latin American nation’s plans to make bitcoin a legal payment method, saying that it is worried about the legal and economic ramifications. IMF officials will continue to engage with Salvadoran officials about the bitcoin initiative.

Meanwhile, the bitcoin proposal could throw a wrench into a separate agreement between El Salvador and the IMF in which the regulatory body was poised to provide a USD 1 billion loan program to the country. The IMF also provided emergency funding to the nation during the pandemic year separate from the loan that it has most recently requested.

While there are still regulatory hurdles that El Salvador will have to jump through in order to make this change, the sentiment is viewed as being extremely bullish for the bitcoin price. Not only that, but market watchers suggest that Central America’s smallest country has the potential to influence other nations for bitcoin adoption.

Sustainable Bitcoin Mining

El Salvador not only is looking to strengthen bitcoin’s use case as a payment method, but it also wants to help solve one of the issues that the cryptocurrency industry is facing. El Salvador, which is known as the land of volcanoes, has offered to use its resources to help make the process of mining more bitcoins more environmentally friendly.

Bitcoin mining or the way by which transactions are completed on the blockchain and new bitcoins are created is an energy-intensive process. After Tesla CEO Elon Musk recently called bitcoin mining out for its carbon footprint, as it typically relies on dirty fossil fuels such as coal to get the job done, El Salvador is swinging back. El Salvador has stepped in and is exploring the possibility of selling volcano-fueled power to miners as an energy-efficient way to mine bitcoins.

According to social media accounts, El Salvador’s decision to make bitcoin a legal payment option started with local communities who for the past couple of years have been working to get local storefronts to accept bitcoin payments on an individual basis. This effort has since blossomed, and industry leaders like Anthony Pompliano, who is behind Pomp Investments, are expecting that other countries will follow in the footsteps of El Salvador. 

Mexico’s Bitcoin Strides

Mexico, where cash is the primary payment method, is also experiencing greater bitcoin adoption. To that end, Bitso, a Mexico City-based cryptocurrency trading platform, has become one of the country’s latest unicorn startups after reaching a valuation of more than USD 1 billion. 

Bitso raised USD 250 million in a Series C funding round with a valuation of USD 2.2 billion attached, thrusting the startup into unicorn status. Bitso attracted several notable venture capital firms to the round, including Panter Capital, Tiger Global, Paradigm, Coatue, Valor Capital Group, and QED. As of year-end 2020, Bitso had more than 1 million users mostly across Mexico and Argentina.

While Bitso is considered the most popular cryptocurrency trading platform in the region, it has not been able to escape scandals that can accompany this loosely regulated market altogether.  Bitso was reportedly the trading platform of choice for some bad actors participating in money laundering among drug cartels looking to stash their funds. But Mexico is looking to strengthen its rules to make it more difficult for criminals to use bitcoin.

Mexico is looking to create a regulatory framework by which cryptocurrency and blockchain startups can operate, which has the potential to give venture capitalists even more confidence to back these startups. Mexican Congressman-elect Eduardo Murat Hinojosa has said that he plans to introduce a legal framework for cryptocurrencies to the lower house of Congress.

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Latin America’s bitcoin profile on the rise thanks to Mexico and El Salvador 12

Latin America and Bitcoin

As the Latin American region (including the Dominican Republic, Haiti, and others) begins to make bitcoin adoption more pervasive, the populations of these countries are gaining exposure to a new way to create and store wealth. Cryptocurrencies like bitcoin remain a volatile asset class where the price can swing dramatically in a short period. Compared to the hyperinflation and slow economic growth that countries in the region are experiencing, however, bitcoin offers them hope for technological innovation, more job opportunities, and greater financial inclusion that has been missing.