Coinbase (COIN), a crypto exchange based in the United States, has integrated the Brazilian government’s payment system Pix and begun accepting crypto purchases in Brazilian reals, the company announced on Tuesday.
The integration with Pix, which has over 140 million users, was made possible through a collaboration with Ebanx, a Brazilian end-to-end payment processor. As a result, customers will be able to withdraw Brazilian reals in addition to purchasing local currency. Furthermore, Coinbase stated that its app is now fully available in Portuguese and offers 24-hour support.
Coinbase shifts focus to the Brazilian crypto market
Coinbase’s mission is to make the crypto economy more accessible and to ensure financial freedom for people all over the world. To begin, it is now possible to add and withdraw money from a Coinbase account using Real, as the platform has integrated with Pix, the Central Bank of Brazil’s well-known instant payment platform. Fabio Plein, Regional Director Americas, highlights:
With the integration of Pix and the enhancement of the Coinbase application, we are offering Brazilians a unique and personalized experience in the world of cryptocurrencies. We believe that these updates are fundamental to democratize access to the crypto economy and boost the adoption of cryptocurrencies in Brazil.
Fabio Plein
In 2021, Coinbase established a technology hub in Brazil, where it subsequently hired over 40 full-time engineers and a country director. Users of Coinbase in Brazil could previously only purchase cryptocurrencies with a credit card.
Exchange of derivatives Bitget and wallet provider MetaMask are among the global crypto players that have recently joined Pix.
Brazil is a key market for Coinbase’s international expansion strategy. We are committed to investing in and developing products tailored to the needs of the Brazilian market, as we recognize the immense potential and growth opportunities in the region.
Nana Murugesan, vice president of international at Coinbase
Coinbase’s reputable dominance in the crypto market
Coinbase aims to make cryptocurrencies accessible to everyone while also protecting its customers’ assets. The company is proud to be the first cryptocurrency exchange on the Fortune 500 list and to be publicly traded in the United States. As a publicly traded company, Coinbase is transparent about its performance, financial stability, and risk management practices.
In addition to a strong capital position and an experienced risk management team, the company holds its clients’ assets on a 1:1 basis, with no restrictions on withdrawals or loans.
Coinbase has a history of prioritizing security and trust in the crypto world, as evidenced by its partnership with Ebanx, Brazil’s payment solutions leader. In addition, the company is dedicated to working with innovators to increase access to the crypto economy and the web3, bringing these benefits to more Brazilians.
Brazilian crypto market environment
Today’s news aims to facilitate Brazilians’ access to the crypto economy and financial freedom. The Brazilian Chamber of Deputies, the lower house of the country’s federal legislative body, passed a regulatory framework that legalizes the use of cryptocurrencies as a payment method within the country toward the end of last year.
It is estimated that 10 million Brazilians, or approximately 5% of the population, trade cryptocurrency. With approximately three million users, Mercado Bitcoin is the largest centralized exchange in Brazil.
Brazil is currently among the top five nations with the most crypto investors. As a hedge against inflation or devaluation, Brazilians are incentivized to purchase crypto over U.S. dollars. Brazilians are required to pay a tax on financial operations – IOF in Portuguese – ranging from 1.1% to 6.38 % when acquiring foreign currency. The tax is exempt for stablecoins.
In addition, the Brazilian Central Bank prohibits the storage of U.S. dollars in domestic bank accounts. In December 2021, the monetary authority eliminated this restriction by approving a new exchange rate framework, but it has not yet been implemented.
The Central Bank of Brazil (BCB) has proposed interconnection with a CBDC (Digital Real), Pix, and Open Finance, as well as potential opportunities to transform the financial services market and connect to the metaverse. Roberto Campos Neto, president of the BCB, asserts that digital assets will result in a “tokenized” economy in the future.
The future of crypto in Brazil will depend on how regulations are drafted here and in other nations, as well as the extent to which crypto prices recover. Nonetheless, it appears that there is no turning back at this point. Traditional banks are closely monitoring this market and paying particular attention to Gen Z consumers, who are most likely to be drawn to cryptocurrencies.
Additionally, a growing number of stores accept cryptocurrency payments. According to CoinMap, more than 900 Brazilian businesses accept crypto payments currently. In the past decade, cryptocurrencies were disruptive, and their future was somewhat uncertain. Still, interest from corporations and governments leads us to believe that crypto adoption is on track to make cryptocurrencies a viable investment and payment option in Brazil and globally.
