Giovanni Russo This edition of Latam Insights offers a synthesis of the pivotal crypto-economic updates from Latin America over the past week. Highlights include USDT’s prevalence in Brazil’s cryptocurrency sphere, accusations of misallocated funds by President Bukele’s government in El Salvador, and the inception of a new Venezuelan exchange coalition.
Table Of Contents
USDT Reigns Supreme in Brazil’s Crypto Trade
The Brazilian Tax Authority (RBF) has recognized the remarkable expansion of stablecoins within the nation’s crypto commerce. Exchange-reported figures indicate that stablecoins, notably USDT, USDC, and the Brazilian real-tethered BRZ, are increasingly involved in a multitude of transactions.
The authority has voiced that the stablecoins’ burgeoning presence in Brazil’s markets “warrants close scrutiny due to potential ramifications on the country’s crypto tax and regulatory frameworks.” Tether’s USDT, which tops the stablecoin market in terms of capitalization, has also emerged as the most frequently traded cryptocurrency in Brazil. It has featured in upward of 80% of all crypto dealings in 2023, circulating over 271 billion reals (approximately $54 billion) since 2019 when the RBF began documenting such data.
Paolo Ardoino, the Chief Technology Officer of Tether, remarked:
The adoption of USDT in Brazil is experiencing a rapid increase. Its significant real-world utility and problem-solving capability naturally drive its widespread utilization.
Allegations of Misuse of Bitcoin Project Funds by Bukele’s Government
Investigative findings by the Organized Crime and Corruption Reporting Project (OCCRP) suggest that President Nayib Bukele’s administration in El Salvador might have redirected funds intended for Covid-19 relief efforts towards Bitcoin ventures.
The inquiry suggests that of the $600 million loan secured from the Central American Bank for Economic Integration (CABEI) in 2021 amid the pandemic, $425 million was allocated towards government liabilities. Of this sum, it is claimed that over $200 million was invested in initiatives related to the adoption of Bitcoin as legal tender in the nation.
Venezuelan Crypto Exchanges Forge New Alliance
Venezuelan cryptocurrency exchanges have established a new association named Acincrip, tasked with formulating policies in response to a protracted seven-month cessation of crypto activities. This pause followed the intervention by the national crypto watchdog Sunacrip and the apprehension of its previous director, Joselit Ramirez.
The coalition comprises the principal national exchanges: Cryptobuyer, AFX, Amberes Coin, and Crixto. Eleazar Colmenares, the head of Acincrip and CEO of Cryptobuyer, in a dialogue with Criptonoticias, mentioned that while the association has been aiding Sunacrip with its probe, there has been no disclosure concerning their strategies to normalize the domestic crypto market.
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Frequently Asked Questions (FAQs) about Latam Crypto Insights
Q: What is the main highlight of the Latam Insights report?
A: The Latam Insights report features USDT’s dominance in Brazil’s crypto market, allegations of fund misappropriation by President Bukele’s administration in El Salvador, and the establishment of a new alliance among Venezuelan crypto exchanges.
Q: What stablecoins are mentioned in the report?
A: The report discusses stablecoins like USDT (Tether), USDC, and BRZ, a token pegged to the Brazilian peso, which are actively used in the Brazilian crypto market.
Q: How significant is USDT’s presence in Brazil?
A: Tether’s USDT is the most traded cryptocurrency in Brazil, appearing in over 80% of all transactions in 2023 and facilitating more than 271 billion reals (around $54 billion) in transactions since 2019.
Q: What are the allegations against President Bukele’s administration in El Salvador?
A: The report suggests that $425 million out of a $600 million loan meant for Covid-19 relief was potentially diverted to fund Bitcoin-related projects in El Salvador.
Q: What is the purpose of the new association formed by Venezuelan crypto exchanges?
A: The association, called Acincrip, has been established to address the challenges posed by a seven-month shutdown of the crypto industry in Venezuela. It includes the four largest national exchanges and aims to develop policies for the industry’s regularization.
More about Latam Crypto Insights
- Brazilian Tax Authority (RBF)
- Tether (USDT)
- Central American Bank for Economic Integration (CABEI)
- Organized Crime and Corruption Reporting Project (OCCRP)
- Cryptobuyer
- AFX
- Amberes Coin
- Crixto
- Criptonoticias
