Inflation, cross-border payments, asset tokens and NFT tokens are among the key drivers for crypto adoption across Latin America in 2022, according to a source in the region. Cointelegraph with examples of exciting progress in many countries
Latin America accounted for 9.1% of the global crypto value received in 2022, reaching $562 billion between July 2021 and June 2022, representing a 40% growth during the period. Ranked among the top crypto users in the latest Chainalysis Global Adoption Index.
in the last 12 months Authorities have been working on central bank digital currency (CBDC), adopting standards for business operations. and clarification of regulations which at the same time Many companies in Latin America are exploring ways to use blockchain technology and digital assets to solve the challenges facing different countries. in the region face
“The region is full of opportunities for adoption of cryptocurrencies,” said a spokesperson for cryptocurrency exchange Bitso. which operates in Brazil and Argentina including other countries in Central America.
“For both Argentina and Colombia. The impact of inflation has driven many people to use cryptocurrencies. […] and for Colombia Money transfers are another big driver of crypto adoption.”
“While Brazil is a major player in the crypto economy in Latin America for a number of reasons including: institutional acceptance, regulatory advances, and buying from the general public. which in that sense Government involvement is inevitable – and this represents a very positive movement. And it will improve the crypto industry while providing more security for investors,” Mercado Bitcoin director Fabrício Tota said.
Colombia also plans to launch a digital currency. It aims to increase transparency and prevent tax evasion. It is estimated to account for nearly 8% of the country’s gross domestic product. And in Chile, the central bank has delayed plans to issue the Chilean digital peso for in-depth benefit and risk analysis.
To combat inflation in Argentina, cities such as Buenos Aires and Mendonza have started accepting cryptocurrencies. for tax payment meanwhile The province of Santa Fe is also planning to run crypto mining activities to raise funds for railroad infrastructure upgrades. These come as Argentina’s inflation rate is expected to be at 73.5% at the end of 2022.
Ryan Dennis, senior manager of the Stellar Development Foundation, said: “Argentina is becoming a hub for bringing technology and resources from the rest of the world to Latin America. “This is flowing into blockchain development. with many startups in the country Therefore, more developers and founders are collaborating on blockchain and crypto.”
“Digital asset tokens have grown over the years,” Dennis said.
Another reason for the rise in financial asset tokens is the high interest rates in the region. Most Latin American countries have interest rates in the double digits. This encourages investors to seek assets with predictable returns and less volatility. And this is an ideal situation for financial companies working on tokens and decentralized finance (DeFi) solutions.
However, “the companies and projects that will lead crypto in Latin America next year will be those that meet the growing demand for transparency and trust,” Bitso spokesperson said.
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