Argentina and Paraguay Settle Export Deal With Bitcoin

cryptopigmedia (56)in #cryptocurrency • 5 years ago

Today we have two South American countries, Argentina and Paraguay, in their first-ever transaction using Bitcoin to settle a payment concerning an export deal between these two countries.

So what exactly happened?

According to the Daily HODL, Paraguay purchased pesticide and fumigation products worth $7,100 from Argentina. Paraguay paid the purchase in Bitcoin, which was then instantly converted into Argentine peso through Bitex, a financial services provider that supports Bitcoin payments. In this circumstance, while the original service was quoted in local currency, the service was using Bitcoin as a vehicle to process fast cross-border payments. The exporter received the Argentine pesos or dollar, while the buyer is paying in their local currency. So no one actually transacted in Bitcoin, but it was their third-party provider that facilitated it.

This is definitely exciting news, as Bitcoin’s cryptocurrency features, of quick-settling payments, ease of cross-border transactions, and low associated costs are proving to be significant advantages for many companies, and in this circumstance countries. Marcelo Moscatelli, the chief commercial officer of Bitex, noted that industry competitor SWIFT has fixed costs that make it more suitable for big players to move significant amounts when it comes to cross-border transactions. Furthermore, the markup fees for converting currencies in cross-border transactions are also expensive for small transfers and is added as an additional percentage of the amount being sent.

The SWIFT system, therefore, doesn’t work well for everyone. Small and medium-sized companies often prefer to use financial third parties like Bitex, where they charge 0.5% for transactions and can transfer the money at significantly quicker rates. They can be settled within an hour as opposed to settlements taking up to three days. Bitex has spotted the opportunity concerning the expensive SWIFT system and now facilitates Bitcoin Payments with suppliers in Chile, Paraguay, Uruguay, Mexico, Brazil, the United States, China, and Australia.

Now we’ve seen similar cases of companies or organizations adopting Bitcoin as an intermediary. As reported earlier just last week, JP Morgan is also looking to do something similar, but via their own JPM Token which will be used to instantly settle transactions between clients in regards to their wholesale payments arm. If you’re interested in looking at this topic, the video link is just here:

What I’ve noticed is, while it’s hard to get the world to begin adopting Bitcoin as a digital gold or the currency of the internet, adopting Bitcoin’s cryptocurrency features and using it as a vehicle may be one of the next steps to get people accustomed to blockchain technology and cryptocurrencies. This is why I always saw so much value in a stable coin, and I still believe 2019 definitely could be the big year for stablecoins.

Now hear me out, guys. While I’d love to see a significant increase in Bitcoin adoption, with the continued security problems, sheer volatility, and scalability challenges, it’s a bit hard to convince the early and late majority to adopt the token into their everyday lives. It’s even hard to convince even the innovators, and early adopters as the technology’s infrastructure are still being built out. But you can’t deny the superior benefits that cryptocurrencies have over fiat currencies which were the things we mentioned before when it comes to transferring and paying someone, and speed it takes to make this all happen.

Stablecoins exist in the middle. They have all the advantages of cryptocurrencies, combined with the stability and trust that they will maintain their value like trusted fiat currencies. There are currently so many stablecoins in the market, with Tether dominating them all, at 7th place on Coinmarketcap. But in saying that the USD Coin is just on 23rd position and has been climbing the ranks ever since they launched last year.

So what are your thoughts on all this, guys?

With companies and now countries looking to third-party providers that use cryptocurrencies like Bitcoin, do you think we’re going to see more use cases of Bitcoin being used as a vehicle to transfer money quickly and seamlessly?

Or do you think, a stablecoin will emerge, dominate, and become the new vehicle to transfer money all around the world?

Let me know what you guys think in the comments Below.

It’s Cindy with CryptoPig. Catch you guys around!

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Disclaimer: Cryptopig content is written by a team of blockchain passionate people. We are not registered as investment advisors. Don’t take the information in this post as investment advice and make sure you do your own research before investing. Cryptocurrencies are a very risky investment, never invest more money than you can afford to lose.

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