Brazil and cryptocurrency – what you need to know

Hear Thiago Cesar, CEO at Transfero Group, discuss what crypto means to Brazil and how the future of crypto currencies in Latin America is developing.

Transfero Group’s mission is to facilitate and foster the adoption of digital assets, offering services in payments, crypto and asset management.

Discussion Points:

• Why is Brazil interested in crypto?
• The impact of Brazil on Latin America’s crypto adoption
• Demographic investment trends
• The biggest opportunities for fintech companies in Brazil
• Why Transfero Group chose to base their headquarters in Brazil

How would you describe Brazil’s cryptocurrency market at the moment? 

 The Brazilian crypto scene has evolved a lot during the past two years, and we have a developed a crypto-space – in contrast to Europe or the United States the majority of the people investing in Bitcoin in 2017 were doing it to internationalize their finances, rather than to make a profit.  

Why is Brazil, specifically with relation to their monetary structure, interested in cryptocurrency?  

In Brazil you can only have bank accounts in the local currency, which means that Brazilians are bound to their local economy and only able to buy local Brazilian Stock Exchange shares. With crypto you have access to the rest of the world.  

 Is Brazil the key trigger for cryptocurrency growth in Latin America, and potentially the rest of the world?  

The real adoption of crypto will come from emerging countries – Brazil is the largest country in Latin America in terms of population and economy, and it can be a role model for other countries. Brazil, along with Mexico, are spearheading the movement in Latin America.  

How is Latin America mitigating economic turbulence using cryptocurrency? 

Every Latin American grows up feeling the pain of losing purchasing power in dollars when their country takes a wrong turn in terms of economic policy. A lot of Latin American people are using crypto as an instrument for survival, especially Venezuela and Argentina.  

 What are Transfero Group’s reasons for having a headquarters in Brazil? 

We are all Brazilians and we wanted to solve the pain point that many people have, with internationalization of finance. It was also easier for us to handle the political and regulatory pressures and navigate the market.  

 What are the biggest opportunities for businesses like Transfero Group in Brazil right now?  

The emergence of neo-banks, which have a different approach to the traditional banks which are antiquated. Neo-banks are more digitized, and anyone with a mobile phone can have a bank – which is a huge benefit in Brazil where many people do not qualify for an account at a traditional bank, roughly 30 million people are unbanked out of a population of 200 million.  

 Recent figures released by the Global Digital report suggests that over 40% of those holding crypto in Brazil are earning below the country’s minimum wage – why is this? 

In the US people see crypto as a speculative allocation in their portfolio, whereas in Brazil people are using crypto to hedge against losing purchasing power, or against inflation. Crypto is a movement that is really happening from the bottom up. 

What does the lack of cryptocurrency exchange regulation, combined with high adoption in Latin America, mean for businesses looking to capitalize on the interest in virtual currencies?  

Regulation in Brazil will eventually lead the way in other Latin American countries like Paraguay and Chile, creating similar basic rules. If a developed country, or bloc, like the EU pass a strong regulation for crypto there is a danger that Latin American countries have to follow that.