Is Latin America the new home of bitcoin? Many signs point to yes. The region is seeing lots of bitcoin adoption. There are good reasons for this growth. Both political and economic causes are fueling it.
Let’s look at some examples country by country. How did Latin America become central to bitcoin’s future?
El Salvador Leads the Charge
El Salvador made headlines. How? By adopting bitcoin as an official currency last year. The government calls it El Salvador’s “boldest bet ever”. No other country had taken such a big step before. Then this small Central American nation did. Leading to more regional bitcoin enthusiasm.
El Salvador also plans the world’s biggest bitcoin mining plant. It will run on geothermal power from volcanos. Keeping costs low and green. Early construction has started on “Bitcoin City”. When finished, this city will fund itself from bitcoin bond profits. Truly trailblazing moves.
Argentina Opens Its Doors
“Argentina became the first country in the world, with an economy of significant size, to accept Bitcoin as a method of payment. The case of Argentina is very interesting because it is the first country in the world that is putting into practice the fundamentals of the Austrian school of economics, which in turn are the foundations for the adoption of Bitcoin globally,” says Tania Lea, director for Latin America at Azteco.
Brazil Primed for Take Off
Brazil seems ready for bitcoin to challenge old norms. It boasts Latin America’s biggest economy. Plus some of the most bitcoin-friendly laws and infrastructure.
Brazils real-time payments network PIX can enable bitcoin for buying everyday essentials. Working with mobile wallets for convenience. Adding bitcoin is easy with PIX’s open API platform. Making adoption frictionless.
Moreover, Brazil treats bitcoin as a financial asset. Not a currency. Avoiding legal hurdles other countries face. Brazilian regulators craft careful but welcome regulation. Growing bitcoin investment while controlling risks.
Mexico, Colombia, Venezuela Next in Line
Other Latin American nations are onboarding bitcoin too. Albeit with smaller economies than Brazil or Argentina. But seeing similar woes from currency issues.
Mexico’s president seeks central bank accountability. He proposes a bitcoin-like central bank digital currency. Hoping digital money could limit reckless policies. Additionally, Mexican regulators enacted pro-bitcoin tax laws. Consumers must report transactions. Gaining legal clarity plus government revenue.
Colombia’s leader shared plans to use bitcoin for financial inclusion and stability. Moreover, the government seeks greener mining operations nationwide. Ensuring broader access to bitcoin’s promise. Still controlling excesses.
Venezuela’s hyperinflationary currency, the sovereign bolivar, weakened Purchasing power severely. For years, bitcoin helped struggling citizens afford basic necessities when money failed them. Now the state promotes its oil-backed digital currency instead. So bitcoin adoption moves into the informal economy bypassing state actions.
Uptake Across Central America
Smaller Central American economies endure currency instability too. Now many embrace bitcoin as well beyond El Salvador. For example, Costa Rica sees extensive bitcoin use already. Panamanians can pay 60,000 merchants with bitcoin through one processor alone. Honduras, Guatemala, Nicaragua allow bitcoin mining using surplus geothermal and hydro electricity.
Paraguay positioned itself as a mining hub given plentiful, affordable hydropower. It’s landlocked neighbor Bolivia grew mining despite government opposition. The steady hum of rigs echoes across quiet mountain towns.
Southern South American Nations Join In
In the south of the continent, bitcoin finds willing users. Both governments and citizens mistrust unreliable fiat money.
Uruguay approved using cryptocurrency for payments countrywide. Making adoption easier. Peruvian regulators now require taxes to be paid from crypto profits. Legitimizing digital currencies while collecting public revenue.
In Chile, you can pay bills with bitcoin. Or use bitcoin ATMs plus trading apps to spend it. Storing value becoming digital over time.
Across nearly all Latin America, bitcoin provides refuge from economic uncertainty. People increasingly rely on it for basic needs. Forward-thinking governments enable innovation using bitcoin to improve finance access and reliability.
With strong local demand and policy support, Latin America transforms into bitcoin’s new promised land. The ultimate global lab for real-world cryptocurrency adoption. The future playing out in real-time now south of the USA border.
This article is based on information originally provided in Tania Lea’s article on Medium. For more details, see Bitcoin Adoption in Latin America 2024.