🇧🇷BCR #34 (1/3): CZ's State Visit
If you’re new here, the meta-thesis for this publication is that Brazil - with a population of 214 million and a US$1.8tn economy - is the most overlooked crypto market in the world. The objective is to highlight the important news and provide useful context for the English-speaking audience.
👋 bd everyone,
I hope everyone had a blast at Ethereum Rio. I’m settling back in after a nice holiday. Naturally, the weeks I took off happened to be when all the big news breaks, so I’ve been spending the last few days frantically catching up on everything that’s happened the last couple of weeks.
There’s basically three weeks worth of news to breakdown here, so I’m sending this week’s BCR out as a triple issue. The first (this one) is focusing primarily on CZ’s visit to Brazil and the implications. I’ll send out one later today covering the Markets and Adoption sections of the news rundown, and I’ll send out another still later today covering the Digital Real news, NFTs and gaming and the policy enforcement news.
🔥 Binance’s Changpeng “CZ” Zhao made Brazil the latest stop on his worldwide charm offensive, meeting with Brazilian politicians and then making a surprise appearance at the Ethereum Rio conference where he was greeted like a rock star and proclaimed that Binance is officially coming to Brazil👇 (via Portal do Bitcoin).
His first stop was Palácio dos Bandeirantes where he met with João Doria, governor of the state of São Paulo and a likely presidential candidate in the forthcoming 2022 presidential election. Other attendees of the meeting were São Paulo’s Secretary of Finance and Planning Henrique Meirelles and Leonardo Machado of InvestSP, the state’s economic development arm.
News of the meeting first came out when CZ tweeted the above image of he and Doria shaking hands. Doria responded thanking CZ for the visit and congratulating him on the “disruptive work he has been doing” and that he should “Count on São Paulo!” No official details were released on subjects discussed during the meeting. CZ also met Doria’s son, João Doria Neto, who appears to be quite the crypto enthusiast himself.
CZ announced that Binance is ramping up its presence in Brazil and is actively looking to acquire banks and payment processors in the country.
Binance signed a memorandum of understanding expressing interest in acquiring Sim;paul, a Brazilian securities brokerage that is regulated by the Banco Central and the CVM (Brazilian SEC)
Sim;paul, headquarted in Porto Alegre, was created in 2019 and offers investment products like stocks, real estate funds, fixed income and others
The proposed acquisition would be Binance’s first acquisition in Brazil and give the company an official presence in Brazil. It currently operates indirectly in the country, though it registered a company called B Fintech - which lists CZ as a partner. Binance users in Brazil currently make deposits and withdrawals through various fiat onramp partners like Capitual digital bank
Binance’s indirect operations in Brazil have prompted regulatory scrutiny and outcry from local competitors accusing it of using unfair practices. Additionally, Binance suspended futures trading on its Brazilian platform last year after the CVM alerted that the company was not registered to be offering such products
Such a deal would require approval from Brazilian regulators, including the Banco Central and CVM.
No timeframe for closing the deal was given, nor were financial terms disclosed
Binance also made a splash earlier this year by sponsoring the Paulistão 2022, São Paulo’s popular football tournament
CZ said in a statement:
“In a fast-developing market like Brazil, crypto can transform and facilitate people's lives and as such we believe — in full collaboration with local authorities — that Binance has a lot to contribute in developing the community and ecosystem in Brazil.” (The Block) (CoinTimes) (Exame)
Some other need-to-know nuggets about CZ’s Brazil visit:
CZ also said that Binance intends to eventually hire 5,000 new employees in Brazil beyond the 100 currently employed by the firm.
He also met with Otavio Ribeiro Damaso, director of regulation at the Banco Central. However he refused to meet with Paulo Guedes, Minister of Economy, because “he saw no reason to do so”, per reporting by Veja.
Binance intends to invest in scholarship programs to help train new blockchain developers.
CZ also revealed that Binance is negotiating with both São Paulo and Rio de Janeiro to establish the company’s Brazil headquarters.
Not everyone was thrilled about CZ’s encounter with Doria. Jorge Stolfi, a bitcoin opponent and University of Campinas computer science professor, said the meeting was “unfortunate” and called Binance “one of the dirtiest crypto exchanges”
CZ gave interviews to O Globo, Folha de S. Paulo and Bloomberg Línea, fielding questions about controversial topics like Know Your Customer rules, regulation and Binance’s role in the GAS Consultoria pyramid scheme affair
Rio de Janeiro Mayor Eduardo Paes was scheduled to appear onsite at Ethereum Rio but could not attend due to an unforeseen event. Instead, he was represented by Chicão Bulhões, Rio’s Secretary of Economic Development, Innovation and Simplification.
However, CZ and Paes outside of the event, with Paes apparently giving CZ the symbolic “key to the city”
Of course, no visit to Rio would be complete without a photo at the world-famous Cristo Redentor statue
💥 Not to be outdone, Coinbase - the largest crypto exchange in the US - is ramping up its presence in Brazil. It is building a local team and establishing Brazil as its tech and product hub for Latin America more broadly.
Coinbase currently has 10 Brazil specific job openings listed on its careers page, but that number will soon expand to 130 (inclusive of Brazil and broader Latam)
Marcello Azambuja, a former engineering director at Uber, joined Coinbase in November as Director of Engineering and Technology and is leading the company’s efforts on the ground. He told CoinTelegraph Brasil:
“Brazil is an important technology hub for Coinbase's global expansion, so we need a global engineering team that reflects our goal of increasing economic freedom around the world. Cryptocurrency is a great opportunity to efficiently and transparently provide access to capital. We believe that some of the best engineering talent is in Latin America and we are excited to grow in Brazil.”
🤯 Other big news is that Brazil’s Banco Central increased the Selic rate, the country’s benchmark interest rate, by 100 basis points from 10.75% to 11.75% - the second highest in the world (behind only Russia). The hike was undertaken to fight inflation which currently registers at 10.5% and is expected to continue in the coming months.
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💣 Trending Cryptos in Brazil
The most popular cryptos in Brazil as of March 18 are Bomber Coin, Smooth Love Potion, Luna Rush and ApeCoin, per data provider CoinGecko.
👩💻Brazil Crypto Hiring Spotlight
Consensys, the Etheruem design studio, has eight Brazil-specific job openings available. These include for several technical positions for Truffle (engineer, product marketing manager, developer relations evangelist), Metamask (senior mobile engineer) and others.
Binance currently has 38 Brazil-specific jobs openings listed on its Linkedin page. These include a multitude of roles across operations, business development, marketing, events, compliance and content
Bitso has 54 Brazil-specific job openings listed on its Linkedin page. Openings range from technical to content to marketing.
Itaú Unibanco has two blockchain developer roles posted on Linkedin
Transfero Group is hiring a senior software engineer, head of distribution and a backoffice operations analyst to work in its Rio de Janeiro office.
Hashdex has hired Nicole Dyskant as Global Director of Legal and Compliance. She will oversee the company’s legal and compliance operations out of its New York and Rio de Janeiro offices, as well as Hashdex’s corporate governance program.