Even after the arrest of “Bitcoin King,” a top cryptocurrency scammer in Brazil in 2021, it is inspiring to see that Brazilians are still taking positively to cryptocurrency. An increase in cryptocurrency awareness and adoption increased the number of registered cryptocurrency users within one month. The figure, exclusive of international exchanges, is a 68% growth. Following this increase, Brazilians traded close to $300 million in July alone.
Even South America’s tax authority, Receita Federal, reported that 1.33 million Brazilians made cryptocurrency purchases in July alone. This was a 68% increase from June. Surprisingly, the report only includes purchases made on Brazilian exchanges. This means that the number could be more than 1.33 million, including foreign platforms. However, the data is inaccessible for now because foreign businesses are under no obligation to comply with Brazil’s local regulation 1888. The regulation states that every cryptocurrency company must report user transactions to the state.
The Brazilian Cryptocurrency Bill
The Brazilian tax authority passed a bill in 2019 to monitor cryptocurrency transactions. These are the requirements of the bill:
1. Foreign exchanges must have an Employer Identification Number (EIN) to apply for a local license. Possession of the license requires them to report transactions.
2. The Brazilian tax authority also includes reports made by individual investors or companies. Both parties are supposed to disclose any monthly amounts above 30,000 Brazilian reais, 5,740 US Dollars.
Brazilian Nubank
The growth is also attributed to the entry of the country’s largest bank in cryptocurrency, Nubank. The bank now has 1 million users after starting its operations in May. The bank added options for customers in May to trade Bitcoin and Ethereum. Nu holdings, the parent bank, confirmed allocating a 1% cash balance sheet to Bitcoin to show its support and belief in cryptocurrency.
Nubank allows its users to trade cryptocurrency using Brazilian’s original currency, reais. The company is excited because it surpassed its milestone. Even Thomaz Fortez, Nubank’s cryptocurrency leader, agrees:
“Nubank has, in eliminating complexity, a value proposition that permeates all our products. With crypto activities, this becomes even more relevant because it is a market with complex systems that make it difficult for people interested in taking their first steps to join.”
The bank is also looking into market tokenization. The CEO David Velez confirmed this but refused to give details. The bank plans to convert traditional finance into crypto tokens.
Brazilian and Cryptocurrency Adoption
Mexico is increasing in cryptocurrency adoption and might soon resolve to full adoption. Another cryptocurrency Bitso, also located in Mexico, announced that it reached 1 million users in the same month. Another bank, Itau Unibanco, Brazil’s biggest private bank, confirmed that it is also looking into tokenization.
With many banks adopting cryptocurrency, awareness is increasing. South America will become famous for Bitcoin conventions and hackathons. Tokenizing fiat is a considerable step, proving cryptocurrency to become a future exchange asset. Adopting 68% of users within one month into cryptocurrency is a huge milestone. Not even America can achieve that.
