The Latin American crypto market is leading among all others when it comes to cryptocurrency adoption and usage, noted local news outlet Economista in a report yesterday.
The captures over 7% of the estimated digital currency economy worldwide, with Mexico accounting for the largest share in the region as per data from July 2019 to 2020. The report cited an on-chain analytics firm Chainalysis report on digital currencies for its findings.
In an online class composed by the Association of Certified Specialists in Financial Crimes, Daniel Cartolin, Chainalysis Development delegate, clarified that, from July 2019 to the very month of this current year, it was identified that Latin America got 24,000 million dollars in moves in digital forms of money and sent 25,000 million dollars to various areas.
“Latin America is answerable for 7% of the estimation of the whole crypto economy (around the world). From July 2019 to July 2020, Latin America got 24,000 million dollars in cryptographic forms of money and sent 25,000 million dollars.”
The representative of the firm specialized in blockchain technology, indicated that it has been identified that both remittances and trade are the most used items for retail payments with cryptocurrencies in the region, that is, those that have a value less than the equivalent of 10,000 dollars, so that both North America and Asia become areas with a strong connection to Latin America in transactions with virtual assets, such as bitcoin.
Cartolin noted that remittances in the traditional world are very large between the United States and Mexico and we are beginning to see areas where cryptocurrency is beginning to be adopted for remittances, because there are fewer fees when it comes to exchanging cryptocurrencies and the person does not have to go to sites like Western Union or Moneygram to do the operation, it can be done from a phone.
In this sense, the director of Chainalysis highlighted that Mexico has managed to capture at least 11% of the retail payments made in the region and this is largely due to the use of remittances that come from the United States.
Crypto-related Fraud a Concern
According to Cartolin, fraud is a recurring theme in cryptocurrency operations in the region, since of the 25,000 million dollars, via cryptocurrencies, sent in the last year, 2.4% was for illicit operations and of the 24,000 million dollars it received In the region, 1.6% were related to illegal acts.
According to the report, most of the operations in cryptocurrencies that had something to do with illegal acts occurred between July and November 2019 and has seen a decline in recent months.
The report details that Brazil represents the largest cryptocurrency market in the Latin American region, followed by Venezuela, Argentina, Mexico, Colombia, Chile, and Peru.
“With 25,000 million in cryptocurrencies sent and 24,000 million received during the period studied, Latin America has one of the smallest crypto economies by volume of transactions, only ahead of Africa and the Middle East”, highlights the analysis.