Since El Salvador's President Nayib Bukele put red laser eyes on his Twitter avatar, local politicians and much of the population have been lobbying for the legalization of in other countries in the region. cryptocurrencies You may have seen loud headlines about legalizing crypto in Latin America in 2023. For example, the biggest country in the region, , approved a crypto bill at the end of 2022 and immediately began issuing licenses, thus setting the trend for the transition from words and regulation to action. International crypto exchanges like Binance and Crypto.com have already obtained official operating licenses in the country. Brazil Why is Crypto so popular in Latin America? Traditionally, Latin American countries have low financial inclusion and relatively little access to a bank account - many are unbanked. In general, cryptocurrencies give the local population additional financial and investment opportunities. Interestingly, despite the popularity of cryptocurrencies and the adoption of laws on their legalization by MPs in and , conservative presidents opposed and vetoed them. This is another proof of how popular cryptocurrencies are in Latin America - MPs passed laws without prior approval from the president because that is the voters' desire. Panama Paraguay What is the main trend? Despite these vetoes, most countries in Latin America have changed their approach to crypto regulation in the last two years. , , , , and have crypto regulation frameworks at various stages of adoption. Although none of these countries has adopted cryptocurrencies as legal tender in the same way as El Salvador, they allow crypto exchange and give a legal basis to the industry. Chile Uruguay Columbia Costa Rica Mexico Interestingly, the de facto regulatory approach is common in many countries in the region. For example, Mexico and Chile already have legislation that allows crypto exchanges to operate in the country. This industry is regulated as part of the fintech industry, though the role of crypto exchanges and other aspects of the regulation still need to be fully spelled out in the law. Also, without laws, working crypto exchanges exist in Colombia and Uruguay. Recent regulation updates: Argentina and Peru And that’s even though, aside from Bolivia, Argentina’s approach to cryptocurrency regulation remains one of the most conservative in the region. This is because Argentina has two exchange rates and about 100% for 2022. The country’s population uses cryptocurrencies to store their savings, making them very popular in the country. inflation In the Summer of 2023, the Senate of Argentina changes to the AML law. These changes must provide a basis for crypto regulation in the country. The National Securities Commission (CNV) will be the main crypto regulator in the niche of AML. Head of CNV, Martin Brienlinger, gave a speech there he provided some information about the crypto landscape in the country and probably the main fact that the local government understands - the country has more than 10,000,000 crypto users - about 22% of the local population. discussed Previously, regulators here tried to limit purchases of cryptocurrencies through banks and cards, but still need to address the fact that local exchanges operate in the country and have a great demand for users. Even a 0.6% “check tax” imposed in 2022 for payments to crypto exchanges didn’t change this trend. Also, the lack of regulations and barriers could be overcome as it does for crypto card providers in Argentina. Local exchange Ripio has launched a card this year in partnership with VISA. And Binance co-launched its cryptocurrency with Mastercard back in August 2022. More recently, moves to change crypto regulation have begun in another country in the region with a high inflation rate, where there was no regulation before. The President of Peru has published this summer a with AML regulations for VASPs operating in the country. All of them must provide a registration procedure by local Financial Intelligence (UIF). decree The document regulates only online crypto exchange platforms, fintechs, and custodians. It doesn’t define other types of VASPs. The future of crypto in Latin America In short, everything is ready for the mass adoption of cryptocurrencies to a Latin American population of over 600 million. According to Mastercard’s , 51% of consumers in the area have already transacted with cryptoassets. New Payments Index 2022 So, we see that the number of active cryptocurrency users in the region's countries is at least in the tens of millions. So, it’s not a miracle that local regulators, even in countries like Argentina, need to somehow react to it and provide regulations. Leading global cryptocurrency and fintech companies are developing products in the area. In general, for now, we can say that cryptocurrencies are popular in Latin America as a way to store money in stablecoins and as a hedge against inflation alternatively. However, over time, there will be a demand for more advanced blockchain services here. If you have any feedback regarding the article's topic - please contact me by e-mail editor@cryptopenetration.com or on X.

This story contains new, firsthand information uncovered by the writer.

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