Blockchain analysis firm Chainalysis recently released data which indicates that since the Mid-March crisis the crypto transactions in Latin America have increased.
The data analytics firm in its report has mentioned that most of Latin America’s crypto transaction is processed to East Asia.
Latin America Using Cryptos As Store Value
The research published by Chainalysis further indicated that currently, many of the unbanked businesses and individuals in Latin America prefer to process the transaction via cryptocurrency.
Cryptocurrencies are not only being used as a means of exchange but also as a store of value and a speculative investment.
Additionally, Chainalysis stated that in Latin America the banking systems are not very effective therefore, the individuals and the businesses decided to shift towards cryptocurrencies.
As per the reports, earlier, mainly the migrant workers from the US used to process payment to Latin America in the fiat currency.
Although the overall transactions of crypto in in the region is not much, it has processed a transaction of over $1 billion in cryptocurrency to East Asia.
Crypto Payments Easier Than Banks
The blockchain analytics firm has stated that most of the businesses in Latin America purchase goods from Asian exporters to re-sell them at home, and while doing so, the businesses make their payment in cryptocurrency.
Recently, the co-founder of Paraguay-based exchange Cripex, Luis Pomata, stated, “cryptocurrency makes it easier for businesses to circumvent costly wire transfers and the import fees levied by regional banks.”
According to Chainalysis, apart from the businesses, many of the individuals in Latin America are shifting towards cryptocurrency payment. They believe that compared to traditional bank payments, processing crypto payment is way easier, therefore, the adoption of a digital asset in the region is increasing.
While explaining Latin American individuals move, the manager of Chilean operations for the SatoshiTango exchange, Sebastian Villanueva, stated that although the people have uneven income, still they process their transaction through cryptocurrency because it is easier than processing bank payment.