Why Latin America is betting on Bitcoin

The political instability that prevails in several Latin American countries along with the collapse of markets like the one of oil and other raw materials is causing to diminish constantly the value of the local currencies. This situation, however, is being exploited by some entrepreneurs to adopt the use of crypto-currencies like Bitcoin in Latin America.

In mid-2015 the BitPay payment system reported an increase in its market transactions of 510 percent during that year, growth that despite not having exact values, has continued its progression during the last months of the year - and As explained by an extensive article published by TechCrunch. In Brazil, for example, the foreign exchange market grew 322 percent, an increase surpassed by Mexico and its 600 percent growth.

Historically, Argentina has been the reference country in terms of use of Bitcoin in Latin America, but the economic situation in the region is changing this trend. During the past year, holders of this crypto-currency have seen their value increase 400 percent above Venezuelan Bolivar and 92 percent with respect to the Brazilian Real among others.

This increase in the value of Bitcoin with respect to local currencies is also partly due to the high inflation experienced by these economies at a rate of 275 per cent, such as the exorbitant case of Venezuela, 30 per cent in Argentina and one 10.4 percent in Brazil that make the Latin American region an area full of opportunities for cryptodivisa:

Being a universal currency, it can be used to carry out transactions in international companies located in Latin American countries that decide to stop accepting local currencies for their low value.
Tourism will be another sector that can take advantage of Bitcoin by not requiring visitors to carry physical money or credit cards, will only require an Internet connection to be able to make purchases.
International companies with offices in South American countries can benefit from the disappearance of the bureaucracy when making payments to their employees since the crypto-currency can be transferred quickly and efficiently.
Many importers in Latin America use the method of reimbursement when ordering their products, this causes that in case of long waits, the fluctuation of the value of local currencies alter the value of the order, adopting Bitcoin this possibility would be greatly reduced .
The growth of electronic commerce that is experiencing Latin America with about 24 percent annually also makes Bitcoin able to find its niche to handle these transactions.
Government bet

The future implementation of this crypto-currency in Latin American monetary systems will depend to a large extent on the interest shown by their governments. In this regard, Argentina can be one of the leaders of this movement after the election as President of Mauricio Macri, who during his last stage as mayor of Buenos Aires has already pushed debates on a possible adoption of Bitcoin.

His successor, Martin Yeza has commented on several occasions also his intention to regulate and implement Bitcoin to make payments in the platform of shared trips Uber. Despite all the possibilities that arise, there are still some impediments that will have to overcome the local authorities in case of wanting to implement a Bitcoin-based economic system in Latin America.

Although it is not at the levels of North America or Europe, today, electronic commerce continues an upward trend as a means of communication in the countries of Latin America; Which leads to predict that the predominance of the conduct of commercial transactions in a physical way and with local currencies, will evolve, along with the expansion of connection to the network, towards a consolidation of cryptodivisa as a payment system in the American region.

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