There are many theories as to when blockchain technology and crypto potentially become as familiar to us as ATMs and credit cards. While some believe the global tipping point could come sooner rather than later, others see the opportunity ahead and realize the groundwork needed in order to ensure a secure and reliable financial ecosystem for everyone.
The reality is, at least in the short-term, the level of crypto adoption will depend on where you are located. We are likely to see uneven global growth as various jurisdictions begin implementing more restrictions, regulations and policies. However, nations facing certain socio-economic factors may be spurring aggressive adoption and increasing demand, even for others beyond their borders, inspiring regional growth.
One region seeing this type of growth is Latin America. For the past few years, Latin America has been embracing digital assets across its national borders as industry leaders look to capitalize on an increasing appetite for crypto products and services. One example is Mercado Libre, Latin America’s leading e-commerce technology company, who in 2021 began offering crypto brokerage services powered by Paxos to millions of its Brazilian customers.
Although the first half of 2022 hasn’t been all that kind to some crypto enthusiasts, we still see heavy interest in crypto across Latin America. What drives this in the face of economic challenges hasn’t been traced to a single catalyst, but some clues exist. One example is the millions of customers looking to send and receive money across national borders to families in neighboring Latin American countries, making peer-to-peer transfers appealing, offering lower costs and featuring decreased transaction times.
With many countries and distinct cultures in Latin America, it’s difficult to make general assumptions without more insight. What we do know, is that Latin American adoption of crypto, as well as the challenges that arise, can help inform all of us as we proceed. The better we understand how crypto works when incorporated into mainstream financial markets, the faster we can improve market infrastructure and see more inclusive access. This gives us all a reason to continue to watch the region closely.