Welcome to Latam Insights, a compilation of the most relevant crypto news from Latin America over the past week. In this week’s edition, stablecoin adoption grows in Venezuela as devaluation hits, El Salvador moves bitcoin from its strategic reserve, and Brazil denounces ongoing dollar weaponization.
Stablecoin Usage Ramps up in Venezuela Amid Rampant Devaluation
Stablecoins have become useful tools in distressed economies where inflation and devaluation indices are sky-high. According to local reports, the stablecoin adoption in Venezuela has been growing steadily, driven by a devaluation process and exchange controls that price dollars in cash at a much lower price than these dollar-pegged tokens.
While physical dollar banknotes need to be spent or exchanged at low prices corresponding with an official exchange rate, stablecoins are exempt from these considerations and can float to prices that are currently 40 to 50% higher. This is because their exchange rates are not regulated by the national government.
This is why companies are including stablecoins like USDT as part of their supply chain payments, buying and selling them for bolivares or simply by using them directly to settle payments with providers and employees.
Read more.
El Salvador Moves Bitcoin for Safety Purposes: Is a Selloff Coming?
El Salvador has retaken the spotlight due to its recent announcement regarding its bitcoin stash. The National Bitcoin Office (ONBTC) of El Salvador reported on Friday that the Strategic Bitcoin Reserve would be moved into various addresses for security purposes.
The office claims that this move, which will split the over 6,285 BTC held by the country into several addresses containing 500 BTC each, will mitigate the possibility of losses coming from potential developments in quantum computing.
On social media, the office stressed that this would allow the nation to keep its public keys unused, maintaining a higher degree of security. On this, the institution declared:
Once funds are spent from an address, its public keys are revealed and vulnerable. By splitting funds into smaller amounts, the impact of a potential quantum attack is minimized.
Read more.
Brazil Denounces Dollar Weaponization, Upholds Right to Trade in National Currencies
The government of Brazil has criticized the Trump administration’s use of the dollar as a political and economic weapon. Fernando Haddad, Brazil’s finance minister, said the issue raised concerns about the nation’s future.
In a recent TV interview with UOL, Haddad acknowledged that the dollar is and will remain the world’s reserve currency for a long time unless the government keeps making mistakes.
Haddad mentioned the growing deficit as one of the challenges the dollar must overcome to maintain its status, and also referred to the issue of using it as a weapon. On this, he declared:
Another thing is this issue of turning the dollar into a weapon of war like what happened against Russia, for example. So, this is what is weakening it.
Read more.
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Author: Sergio Goschenko
Source: Bitcoin
Reviewed By: Editorial Team
