Latin American citizens boosted crypto turnover to $562 billion between July 2021 and June 2022. These results made the LATAM region the seventh-largest crypto market in the world.
Latin America’s crypto market has grown 40% in the past year. Cryptocurrency turnover in the region is estimated at $562 billion between July 2021 and June 2022. Chainalysis analysts have come to these conclusions after studying trends in the LATAM market.
The key drivers of crypto adoption in the region are:
- the ease of cryptocurrency transfers;
- the fight against rising inflation;
- the pursuit of profits.
Chainalysis experts note that the demand for cryptocurrency transfers in the region has been the main factor behind the growing crypto market. So, according to the report, the regional crypto transfer market will hit the $150 billion mark in 2022.
Mexico has been the most active in transferring cryptocurrencies. Crypto transfers by Mexicans accounted for 4% of all remittances in the country between July 2021 and June 2022. At the same time, the increased demand for the service exceeded 400% year-on-year. Recall that RippleNet’s On-Demand Liquidity (ODL) service was used to provide cross-border payments between Mexico and Brazil.
The inflation rate in Latin American countries is rising, so citizens seek to protect their savings by converting fiat money into cryptocurrency. Stablecoins are in great demand in the region, with about 30% of Latin Americans using them daily as a means of payment in 2022. For example, 34% of Venezuelans, 31% of Argentineans, 28% of Brazilians, and 19% of Mexicans used stablecoins for daily transfers of less than $1,000.
The report also notes that the main incentives for the region’s residents to use stablecoins in their daily lives are:
- the peg to the dollar, which a majority of the region’s citizens consider to be their preferred currency;
- the availability of digital dollars on a variety of devices;
- no restrictions on buying them.
Using cryptocurrencies as a profit-making tool also increases the appeal of digital assets to Latin Americans. The leader in DeFi sector activity is Chile. About half of crypto transactions in the country were made on DeFi platforms. Brazil, Mexico, and Peru aren’t far behind, with about a third of the population using crypt for “a speculative activity with significant risk and upside potential.”
According to CoinsPaid’s research, the crypto adoption rate in Latin America exceeds 60%.
