#142: Consensus 2024 Recap; BTG, Nubank, Mercado Bitcoin announce USDC partnerships
Plus: Trexx receives funding from ImmutableX for blockchain game development; Ripple announces recipients of Brazil-targeted developer grants
Olá pessoal!
Welcome back to Brazil Crypto Report for the week of May 27-31, 2024, where I’m wrapping up an exciting week at Consensus 2024.
It was great seeing a bunch of you IRL on the ground in Austin, Texas around main event and all of the various DePIN, DeAI, DeCompute side events. It was also super cool to see a delegation of ABCripto folks make the trip up.
I also got to participate in a special Brazilian happy hour on Friday after the main event!
If you’re looking for Portuguese language content from the event I’d recommend checking out Paulo Alves’ work for InfoMoney and Leonardo Cavalcanti’s reporting for BlockTrends.
🔍What’s in this week’s BCR?
BTG Pactual, Nubank and Mercado Bitcoin have launched USDC partnerships with Circle
Trexx has received funding from ImmutableX to support its blockchain game development and adoption efforts
Foxbit launches a prepaid crypto card that offers 1% cashback on all purchases
Ripple announces the recipients of its Brazil-focused developer grant program
Thanks for reading and have a great week!
-AWS
💡Quick public service announcement: I keep all 🇧🇷BCR content free and accessible so as to promote Brazil’s crypto ecosystem as widely as possible! However, I leave the “upgrade to paid” option enabled as a donation method for those who wish to support me financially (greatly appreciated!)👇
New podcasts!
Two new episodes for you this week. The first is a Web Summit Rio panel session (recorded in Portuguese) with Hashdex CEO Marcelo Sampaio and ABCripto CEO Bernardo Srur discussing how the bitcoin ETF approvals in the US have propelled the industry in 2024. (Big shoutout to the Transfero team for hosting us for this session!)
The second is an interview I recorded in Brasilia with Gurvais Grigg, who is a 20 year FBI veteran turned chief technology officer at Chainalysis focusing on the public sector. We discuss the state of crypto usage in criminal activity — who’s using it, for what purposes, and how governments and law enforcement entities are responding.
🎧 You can find Brazil Crypto Report content wherever you listen to podcasts: Spotify | Apple Podcasts | Amazon | Anchor | YouTube
Circle inks USDC partnerships with BTG, Nubank, Mercado Bitcoin
The company behind the USDC stablecoin rolled out three new partnerships in Brazil intended to make it easier for consumers and investors to access the dollar-pegged asset.
BTG Pactual, Nubank and Mercado Bitcoin will all offer the stablecoin as part of their portfolio.
BTG will serve as the direct liquidity provider for USDC in the country, allowing companies and investors to issue and receive USDC in Brazil via the local banking system.
Andre Portilho, head of digital assets at BTG, says he sees ample demand from entities looking for cheaper and easier means of acquiring dollars:
“We will show companies how we can use this new instrument to make dollarization easier and cheaper.”
Mercado Bitcoin will allow customers to transfer fixed income tokens from their MB-hosted wallet to other wallets, such as Metamask, through payment in USDC. Roberto Dagnoni, CEO of 2TM, explained:
“We are going to create a ‘whitelist’ of permissions. The user indicates the address of the wallet they intend to sell to and we check it against the 'whitelist' to prevent it from going to a platform we don't trust or to malicious addresses… This allows us to access liquidity pools and people out there.”
People living outside Brazil will also be able to buy fixed-income tokens from MB using USDC.
Two horse race
USDC is the second-largest dollar-pegged stablecoin with a market capitalization of US$32.5 billion. It trails only USDT, which has a market cap of US$111.8 billion.
While that is a large gap to make up, the company argues that USDT will eventually be illegal in most jurisdictions, and therefore financial institutions should make haste in embracing USDC. CEO Jeremy Allaire explained to Valor:
“You will see more and more jurisdictions where these products are illegal. This is already happening in Europe, with the adoption of [European Union regulation on cryptocurrencies] MiCA, and will see it occur in other markets.”
USDC > Pix?
Allaire also argued that while he thinks stablecoins are an inherently more interesting innovation than Brazil’s native Pix due to their global and interoperable nature, he believes they can be complementary innovations:
“We have believed since our first day that we must become closer to governments and legislators. And Brazil will play an increasingly greater role in the global financial ecosystem.”
He added that the BTG and Nubank partnerships are just the beginning of Circle’s entry into the Brazil market, and explained that the country is taking a refreshingly open-minded approach towards stablecoins and blockchain tech.
“Here in Brazil there are so many players who assume that this is the technology of the future. It's a more open mind. In other places there is more fear.”
Valor Exame BlockNews Portal do Bitcoin CoinTelegraph Brasil
BTG’s Sallouti: blockchain has “great chance” of being the financial rails of the future
BTG Pactual CEO Roberto Sallouti is bullish on the idea that blockchains will be the technological infrastructure underlying the financial system of the future.
“I don’t know how much bitcoin is worth, but I am convinced that there is a great chance that the financial rail of the future will be blockchain.”
In particular, he’s excited about blockchains’ ability to tokenize real world assets, remove intermediaries, enable programmable money and make it easier and cheaper to issue new financial products:
“We were sad not to have 5 thousand branches, then we saw tokenization and Drex and realized the possibility of closing the gap…It is so simple to make a stablecoin transaction that it is embarrassing for our current system.”
Trexx receives ImmutableX grant for blockchain games ahead of July launch
Brazilian blockchain gaming platform Trexx received an undisclosed amount in grant funding from ImmutableX, a blockchain gaming infrastructure company.
Blockchain games took off in 2021 with the rise of Axie Infinity but cooled off during the bear market. Still, they are seen by many as one of the “low hanging fruit” use cases for blockchain tech given the digitally-native nature of the platforms and the gamers themselves.
Heloisa Passos, CEO and founder of Trexx, explained to Valor that the technology is getting closer to being shovel ready and that game development giants like Ubisoft, Konami and SquareEnix are getting involved in the trend — albeit timidly:
“This is a point we work on at Trexx. We must abstract terms. It will be easier for gamers to understand that they have a unique collectible than to explain that there is a blockchain behind it. There will be hard players selling their items and there will be people buying items from other players, as is already the case, but in an organized way.”
Passos added additional context about why the partnership with Immutable was a no-brainer:
“In addition to the financial support incentives, one of the points that made us more adept at partnering with Immutable to use the new zkEVM is the support with the necessary technology for blockchain-based game developers to facilitate transaction fee issues. that affect end users. Additionally, there is the “frictionless onboarding” experience for Web3 gaming fans. This way, we were able to increase adoption.”
Trexx intends to publish its first game “Boom Boogers” later this year and has several other games available on its platform. Currently in beta, Trexx will launch to the public in July with the goal of reaching 20,000 users by the end of 2024 and two million in two years’ time.
BlockNews CoinTelegraph Brasil
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🗞Brazil Crypto News Rundown
📈 Markets
PagCripto announced that it had implemented an asset segregation system to separate customers’ coins from the exchange’s operating wallets in anticipation of guidance from the Central Bank of Brazil on the subject. Recall that the asset segregation question has been a thorny one, as it is a concept that the market and regulators generally support, but it has been difficult to find the right legal grounding to implement it. (CoinTelegraph Brasil) (Livecoins)
Hashdex withdrew its application for a spot Ether ETF in the US one day after the SEC approved eight similar products. No reasons were given for the withdrawal or whether Hashdex will resubmit the proposal. (CoinTelegraph Brasil)
Foxbit has launched a new prepaid card allowing holders to pay for goods and services via crypto via an instant conversion into BRL. The card, which is issued by Pomelo under the Mastercard brand, has no annual fee and offers 1% crypto cashback on all purchases. CEO Ricardo Dantas said in a note:
“This card is not just a means of payment, but a bridge to integrate cryptoeconomy into people’s daily lives.” (Valor) (CriptoFacil) (BlockNews) (CoinTelegraph Brasil)
Viden Ventures, a Brazilian VC focused on the Web3 market, invested in the seed round of Magisat, a marketplace focused on trading rare sats, ordinals and runes. (Portal do Bitcoin)
Enegix Global, one of the largest bitcoin miners in the world, intends to expand its operations to Brazil. Yerbolsyn Sarsenov, CEO of the Kazakhstan-based miner, says the company is attracted by the energy and regulatory advantages that the country offers. The initial operation will be an 80 megawatt facility in the northeast region of the country, with the goal of expanding to 200 MW in the coming years:
"Brazil presents conditions regarding natural resources that make it a powerhouse in bitcoin mining. Here, we find a very significant amount of natural resources that provide energy generation with the cost and efficiency we seek." (Exame) (CoinTelegraph Brasil)
Dynasty Global, the Swiss company founded by two Brazilians, acquired a US$11.5m stake in the Swiss asset tokenization company BrickMark with the aim of enabling tokenization of US$9bn in real estate assets. (Exame)
Mastercard launched its Crypto Credential product at Consensus 2024. The product allows users on participating platforms to send and receive funds using pseudonyms rather than long blockchain addresses. Users of Foxbit, Mercado Bitcoin and other exchanges can use the platform for transacting between Latin American and European corridors. Walter Pimenta, Mastercard’s executive VP of product and engineering for Latin America, said in a statement:
“As interest in blockchain and digital assets continues to grow in Latin America and around the world, it is essential to continue providing trusted and verifiable interactions on public blockchain networks.” (Portal do Bitcoin) (CoinTelegraph Brasil)
BRLA Digital, creator of the BRLA real-pegged stablecoin, said that it had reached the mark of more than US$10 million in total processed payments since launching last year. (BlockNews)
While unlikely, ethereum still has a shot at “flippening” bitcoin’s market cap once the recently approved ETH ETFs in the US are up and running, Hashdex CIO Samir Kerbage argues. (CoinTelegraph Brasil)
📲 Adoption
Despite privacy and scalability concerns encumbering the Drex project, Brazilian banks are still optimistic about its development and see a path forward in the coming phases. (Exame)
Ripple announced the recipients of its grants program for Brazilian projects. Select recipients include: Cointimes (US80,000) for an X-to-earn plugin; goAssets (US$100,000) for its tokenization product; Amora (US$100,000) a Shopify app for NFTs; XRPL Elixir (US$10,000) which allows devs to interact with XRPL via APIs; ThingsGo.Online (US$75,000) for its rewards system; Cryptum (US$50,000) which integrates the XRP blockchain with any application, and several more. (Valor)
61% of Brazilian crypto investors do not intend to sell their bitcoin, according to a new survey of roughly 500 individuals conducted by crypto exchange Bitget. (Portal do Bitcoin) (InfoMoney) (CriptoFacil)
The Federal Public Ministry has hired Techbiz Forense Digital to monitor the use of cryptocurrencies in the country, per publication in the Official Gazette dated May 24. The purpose of the contract is to “subscribe to a system for identification, monitoring, tracking, research and analysis of electronic transactions using cryptocurrencies and contracting training for the use of the system”. (Portal do Bitcoin) (CriptoFacil) (CoinTelegraph Brasil)
Brazil has an energy surplus that can be used for bitcoin mining, generating revenue and promoting socio-environmental development, argues Arthur Inc chief business officer Flávio Hernandez in a CoinTelegraph Brasil op-ed.
🏛 Policy, Regulation and Enforcement
The Brazilian Association of Financial and Capital Markets Entities (Anbima) launched a public consultation on new proposed rules guiding how Brazilian investment funds can allocate to crypto assets. (Exame) (CriptoFacil) (Portal do Bitcoin)
The last at-large member of the Trust Investing bitcoin pyramid scheme was arrested in Santa Catarina by Military Police. Claudio Barbosa had been on the run since 2022 and was reportedly living a life of luxury in Florianopolis. (Portal do Bitcoin)
In Operation Rediscovery, Federal Police executed 21 search and seizure warrants and six preventative arrest warrants against members of a criminal faction that had defrauded bank accounts in Portugal from Brazil. Funds were stolen via social engineering schemes, remitted back to Brazil and then used to invest in elaborate cryptocurrency investment schemes. (Valor) (Portal do Bitcoin)
The Federal Court of Brazil says it has delivered all of the documents necessary to extradite Braiscompany founders Antonio Neto Ais and Fabricia Campos. The couple remains under house arrest in Argentina after fleeing Brazil in early 2023 following the collapse of the Braiscompany crypto investment scheme. (Portal do Bitcoin)
Francisley Valdevino da Silva, aka the “Sheik of Bitcoins”, laundered R$600,000 (US$115,000) worth of digital assets through a company called Cash Back, which Federal Police assert operated as a “crime bank.” (Portal do Bitcoin)
Portal do Bitcoin reviewed the new book “Queda Livre: The Story of Glaidson and Mirelis - Pharaohs of Bitcoins”, which chronicles the story of the GAS Consultoria bitcoin pyramid scheme.
In Operation Kill Switch, Civil Police arrested a government employee in Cuiaba suspected of using public servers to operate a cryptocurrency drug sales scheme on the dark web. (Portal do Bitcoin)