Ripple, the cryptocurrency and payments company, has published an article exploring the opportunities Latam offers for crypto companies as its regulated payment rails come to crypto. While the region faces some obstacles due to its economic characteristics and the dominance of centralized banks, the organization believes there is a lucrative opportunity for companies partnering with these banks to bring crypto to the masses.
Ripple sees opportunities in Latam
Ripple, the bank payments, remittance and cryptocurrency company, believes that Latam could be a hotspot full of opportunities for crypto businesses in the future. In a recent article, Ripple examines current payments and the possible integration that crypto services could find in the region. According to the company, crypto companies could find these opportunities as banks begin to integrate cryptocurrency services into their platforms.
The company explained the idea:
There is a lucrative opportunity for traditional banks, fintechs, and governments to ramp up adoption of crypto forward technology to address this underbanked and fragmented market.
This points to the idea of crypto companies working with banks and fintech companies to take an active role on the main lanes for transactions and payments in these countries.
obstacles to the process
However, this integration process would likely not be without its hiccups. Traditional payment tracks are managed by banks in the region, and bank inclusion is very high in some of the largest countries, with 88% and 82% of the population in Brazil and Chile having bank accounts, respectively. Opportunities come in the form of services with lower fees than traditional institutions, which could push people to switch from cash and other payment methods to digital transactions.
The inclusion of crypto companies in the various debates taking place on regulation will also be very important for the future of crypto in the region, according to the article. Ripple believes this process will be positive, stating:
Smart and progressive regulation will breed more successful regulation – leading to more innovation and advancement around crypto across Latin America.
In that sense, there is a regulatory awakening happening across the continent, with countries like Brazil and El Salvador leading the way when it comes to crypto regulation. Brazilian lawmakers have promised to submit unified regulation for cryptocurrency assets to Congress for approval in the coming months, and El Salvador made Bitcoin legal tender with the approval of its Bitcoin Act last year.
This scenario presented also includes a progressive detachment from the dollar and US markets, which are currently having a significant impact in the region. Ripple concluded:
The ability to be isolated from the financial volatility of other regions underscores an important reason why achieving interoperability across Latin America and avoiding the de-risking trend in the US is so critical to Latin American economies.
What do you think of Ripple’s take on the future of crypto in Latam? Tell us in the comment section below.
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