🇧🇷BCR #77: Binance Teams Up with Mastercard to Bring Crypto Debit Card to Brazil
Also: Banco Capitual eyes overseas expansion; PicPay hits 1 million crypto customers in Brazil
Huge welcome to 🇧🇷Brazil Crypto Report for the weeks of January 30 - Feb 3, 2023. I hope everyone is doing well.
Before we dive in, I thought I’d share a super helpful YouTube channel I found recently called Speaking Brazilian. I’ve been using this a lot to brush up on my Portuguese. It’s a really great resource for gringos so highly recommend checking it out if you’re looking to improve your skills here.
I enjoyed this particular lesson below that looks at the 10 things you should avoid doing while traveling in Brazil. These include:
🇪🇸 trying to speak to a Brazilian in Spanish
✈️ claiming the Wright brothers invented the airplane (it was Alberto Santos-Dumont, obviously)
⚽️ talking about the 2014 World Cup match against Germany
🚗 slamming car doors (?)
As always, I appreciate you reading and I hope you have a great week.
Binance and Mastercard launch crypto debit card in Brazil
The world’s largest crypto exchange’s debit card will allow users to pay in 14 different cryptocurrencies while earning up to 8 percent cashback on eligible purchases. Guilherme Nazar, Binance’s director-general for Brazil, said in a statement:
“Payments is one of the first and most obvious use cases for crypto, yet adoption has a lot of room to grow. We believe the Binance Card is a significant step in encouraging wider crypto use and global adoption, and the openness of Brazilians to innovation makes the country a great market for this release.”
The card will be available in the coming weeks. It is being rolled out in beta mode initially but will soon be available to all Binance users in Brazil with a valid national ID.
Binance launched a similar product in Argentina in August, 2022 and intends to introduce the card in other markets as well.
Cardholders will be able to make payments in 14 different currencies: Brazilian Real, BNB, BUSD, USDT, BTC, ETH, SANTOS, ADA, DOT, SOL, SHIB, XRP, MATIC, and LINK.
Payments made with BRL are zero-fee, while payments made with crypto will incur a 0.9 percent conversion fee
The 2022 Mastercard New Payments Index found that 49 percent of Brazilian consumers have conducted at least one crypto-related activity in the last year, making Brazil one of the top markets worldwide in terms of crypto interest. Marcelo Tangioni, Mastercard’s Brazil country manager, commented:
“Brazilians are eager to embrace crypto beyond an investment asset. Today is an exciting step in our crypto journey, which draws on the strengths of both our trusted global network and Binance’s infrastructure to support consumer choice in payments.”
Capitual inks US$16 million investment in overseas push
Capitual, the crypto-friendly fintech most famous for being Binance’s fiat on ramp in Brazil until June 2022, received the investment from Azimut - one of Italy’s largest asset managers. The crypto bank will use the funds to expand its operations into Mexico and Europe.
Guilherme Nunes, Capitual CEO, explained the reasoning behind the deal:
“We want to replicate the product we have in Brazil in other countries, serving our partners also in other jurisdictions. The idea is to become a blockchain technology hub in these markets.”
Capitual provides fiat onramps into the Brazilian market for several foreign exchanges, such as Huobi, Kucoin and Bitget. It provided these services to Binance until last summer when a contract dispute ended that relationship and left Binance without a proper payment processor for nearly three weeks.
The investment puts Capitual at a valuation of US$327 million, putting it on the way to becoming a potential Brazilian crypto unicorn.
JBS made second-largest bitcoin ransomware payout ever
The Brazilian meat-packing giant paid US$11 million in bitcoin after a cyberattack in 2021, according to a new report released by software security firm Immunefi. The firm had its tech stack “hijacked” in January 2021 and had to transfer the funds to the hackers to regain access, InfoMoney reports.
The payout ranks as the second-largest ever, behind the US$40 million paid by Chicago-based insurance company CNA Financial in 2020.
🗞Brazil Crypto News Rundown
PicPay, Brazil’s largest digital wallet, announced that it had reached one million customers for its crypto offering - which first launched in mid-2022. The company, which has 30 million total users on its platform, also began to offer Solana - bringing its total crypto offering to 10 tokens. It also introduced a new price alert feature. (Valor)
Xtage, XP’s cryptocurrency platform, enabled trading of three new cryptocurrencies: Cardano (ADA), Solana (SOL) and Litecoin (LTC). (Valor)
“Imported” bitcoin and other cryptoassets generated a US$7.37 billion deficit on Brazil’s trade balance in 2022 as calculated by the Brazilian Central Bank. The numbers represent crypto inflows via international exchanges or mining operations.
The value of crypto inflows is close to surpassing that of small-value e-commerce imports
Bitcoin inflows began impacting Brazil’s trade balance in 2019 when the Central Bank began including them in its calculations. (CoinTelegraph Brasil)
The Santos FC token was the best performing fan token globally in 2022, according to a study by Trading Browser. The token finished the year up 22.59 percent, from US$3.50 to US$4.29. (CoinTelegraph Brasil)
Crypto and fintech voice Gustavo Cunha argued in a BlockNews op-ed that a proposed shared currency by Brazil and Argentina is an “idea in search of a use case”.
The benefits of such an arrangement would ostensibly be streamlined trade flows between the two nations, but because Argentina’s relevance as a trading partner has been on the decline for years, it’s unclear how much benefit would be reaped.
The motivation behind the proposal does not seem to be one of thwarting future conflict or increasing integration, as was the case with the Eurozone, but rather Argentina seeking a solution to the problem of not having sufficient financing in dollars for its businesses.
Asset tokenizer Liqi has distributed R$622,000 to holders of the Cruzeiro token, in relation to the sale of defender Fabricio Bruno to Flamengo last year. Liqi CEO Daniel Coqueiri commented:
“As of this year, people are able to see in practice the impacts that tokenization will generate in the market and in the world as a whole. In the last 2 months alone, we had 3 payments to Cruzeiro Token holders. And, if we stop to think about it, this is an asset that would not have been a possibility for any fan or investor before the possibility of tokenization” (CoinTelegraph Brasil)
Coqueiri also penned an op-ed for Portal do Bitcoin discussing tokenized receivables, which he argues will be transformative in 2023.
Lucas Lendel, co-CEO of Brazilian asset manager iVi Technologies, argued that bitcoin could reach a price plateau of US$25,000 - US$30,000 in February. (CoinTelegraph Brasil)
MB Tokens launched its first digital token linked to the real estate market in partnership with Braspark. The token is based on receivables and inflows from a logistics warehouse rental contract. (Portal do Bitcoin)
Gabriel Rodrigues, a promoter of several suspect pyramid projects, is planning to launch his own crypto brokerage called Vinco. He raised money via an initial coin offering, among other means, to begin building the exchange. In an Instagram post he stated:
“After years traveling the whole world and meeting market giants, I created a completely innovative project, not only in Brazil but in the world” (Portal do Bitcoin)
Paulo Alves of InfoMoney has a great explainer article discussing some of the key differences between Brazil’s Digital Real and other CBDCs being developed around the world, such as China’s e-CNY (or digital yuan).
Orlando Telles, top analyst at Mercurius Crypto, announced on Twitter that he left the firm in late 2022 due to a “misalignment of values and vision about the company in relation to the other partners”.
The announcement turned into a bit of a dust-up on Twitter as Gabriel Bearlz, another Mercurius partner, took a jab back at Telles implying that it was a mistake to have allowed him to became the de facto face of the organization:
We created the false impression that there was a person responsible for everything that happens within the company and reduced the importance of our most precious asset, which is our analysis team.” (Portal do Bitcoin)
1.16 million CPFs (unique individuals) in Brazil reported cryptocurrency transactions during November 2022, up 120 percent year-over-year, according to data from the Receita Federal. However, the figure is a decrease of 8.5 percent from October.
45,586 CNPJs (unique businesses) declared crypto transactions during the same period, up 6x year-over-year but down 6.3 percent from October 2023
Brazilian exchanges reported R$8.8 billion (US$1.71 billion) of transaction volume for November, down 17 percent from October.
Crypto transactions made peer-to-peer, ie without an exchange, totaled R$1.9 billion (US$369 million)
Reported transactions made on exchanges not domiciled in Brazil totaled R$603 million (US$117 million). (Valor)
Bitcoin, Ethereum, BNB, Tether, Solana and Cardano are among the most searched cryptocurrencies in Brazil by state, per an analysis of Google Trends by Livecoins
Brazil has the 6th highest number of cryptocurrency owners of any country, with 7% of the population holding some form of crypto asset, according to a study conducted by CoinJournal. The countries placing higher than Brazil on the survey were United States, Vietnam, Pakistan, Nigeria and South Africa. (CoinTelegraph Brasil)
Bitybank, formerly known as BitPreço, laid off nine employees from its team of 51. The cuts come amid the bear market and just six months after merging with Biscoint - a crypto exchange that had popular Brazilian YouTuber Thiago Nigro (aka Primo Rico) among its partners. The acquisition apparently rendered several positions duplicative or redundant. (Portal do Bitcoin)
Ethereum design studio Consensys launched its Metamask Learn educational platform in Portuguese. The program guides users through courses on Web3, custody, NFTs, and decentralized finance. (Portal do Bitcoin)
Retail users will soon be able to use Foxbit Pay to send and receive cryptocurrencies using the platform and settle purchases through an automated crypto-BRL conversion. The service had previously only been available to merchants and larger entities. Rodrigo Ikegaya, Foxbit’s director of products and business, commented:
“We want to become anyone's gateway or first crypto experience, providing a friendlier experience for everyone who wants to enter the crypto market, even if the goal is to convert the cryptocurrencies received immediately into reais.” (Valor)
Mercado Bitcoin unveiled a new incentive program rewarding customers who invite new members into its Discord server. (Portal do Bitcoin)
Moss, the issuer of the MCO2 carbon credit token, announced a partnership with Invert, a Canadian company, to contribute US$1.5 million to Amazon conservation projects. (CoinTelegraph Brasil)
Nathalie Arcuri, founder of the popular Me Poupe! YouTube channel, responded publicly on Instagram to the news that the firm had laid off 60 employees, roughly half of her staff, at the end of January. Despite the cuts, the company is still advertising several job openings on its channels.
Arcuri explained that the Me Poupe! will continue educational efforts focusing on new technologies like ChatGPT and Web3, writing:
“Me Poupe! is not going through a financial crisis…It was really tough. It was the hardest decision I have had to make since starting my business in 2015…Tough changes are necessary if we are to reach our bigger goals” (Portal do Bitcoin)
Blockchain Academy, the educational platform owned by Mercado Bitcoin, is offering a new course on digital asset management in conjunction with Insper, a prominent São Paulo business school. (Portal do Bitcoin)
🎮 NFTs, Gaming and Metaverse
Brazilian companies are interested in investing and adopting technologies related to metaverse and decentralized finance in the next 1-3 years, according to FIS’ Global Innovation Report 2023.
83% of executives interviewed said that it will be strategically important to have a presence in the metaverse in the next 1-3 years.
Anderson Lucas, vice president of business at FIS for Latin America, commented:
"Speaking of risks and opportunities, these movements may give butterflies in the stomach, but they are part of the business and allow companies to rethink their businesses, models, the way of doing things. Risk is inherent in any business when there are companies each increasingly competitive in search of scale and innovation". (Exame) (BlockNews)
Play4Change launched a new partnership with Sonica to help vulnerable people through the sale of NFTs. (CoinTelegraph Brasil)
🏛 Public Policy, Regulation and Enforcement
ABCripto, the lobbying group representing the Brazilian crypto industry announced several key staffing changes. Henrique Teixeira, Ripio’s global head of business development, assumed the role of chairman at ABCripto, while Bernardo Srur assumed the CEO position.
The two argue that the coming 6-12 months will be critical for the crypto industry in Brazil as it looks to implement the legislation signed into law at the end of 2022.
Edison Neto, CEO of Zro Bank, also joins the board as a vice president.
In an interview with Exame, Teixeira argued that carrying out continual educational work, implementing the laws now on the books and further developing industry self-regulation will lead Brazil to become a global player in crypto markets:
"[It will be possible to] attract the attention of the Brazilian and world market, with Brazil being a one of the few countries in the world with a law for digital assets. The country becomes an international reference, being able to attract more investors and players, and the market will develop even faster".
Civil Police in Rio de Janeiro arrested former Botafogo manager Ricardo Wagner de Almeida for allegedly operating a crypto pyramid scheme called Futura Invest in close connection with GAS Consultoria, the operation run by “Pharaoh of Bitcoins” Glaidson Acácio dos Santos. Authorities described the company as a type of “pyramid with in a pyramid” that invested users funds into GAS. (Valor) (CoinTelegraph Brasil) (Portal do Bitcoin)
Binance’s associate director for government relations in Brazil, Felipe Oriá, argued at a Binance Meetup in São Paulo that the crypto legislation passed last year is an important and principled step to advancing the crypto economy in the country. He stated:
“The Legal Framework for Cryptoassets, Law No. 14,478, which was approved on December 21, 2022, is the starting point for us to have this regulated, to start organizing the ecosystem….what is regulated are the uses of technology and, in that, our perspective is that the bill was very successful, because it is a principled project.”
Braiscompany, the embattled crypto investment firm suspected of being a pyramid scheme, was ordered to pay a debt of R$144,900 to the son of a former Federal Deputy. The debt is for late rents on a leased property in the Lago Sul region of Brasilia. (Portal do Bitcoin)
The firm also has reportedly ignored a new request to return R$10 million worth of assets to 30 clients (Livecoins)
Despite being unable to make payments to investors, Braiscompany creator Antonio Neto Ais announced that he was sponsoring a football match in São Paulo involving Ronaldinho Gaucho, the five-time world champion footballer.
Portal do Bitcoin’s Saori Honorato talked to former Braiscompany employees and got the inside scoop on life inside the embattled company. In an exposé she describes an intense pressure to attract new investors, many of whom are Paraiba’s political and economic elite, at all costs.
The CVM, Brazil’s securities regulator, argued that GAS Consultoria carried out fraudulent operations with cryptocurrencies. The designation could prompt the Rio de Janeiro Court of Justice to reject a request for judicial recovery, increasing the likelihood that the company will file for bankruptcy. (Portal do Bitcoin)
Brazil’s Federal Public Ministry is published a study on bitcoin money laundering and a guide on confiscating cryptocurrencies to be used by law enforcement and prosecutors throughout Brazil. (Portal do Bitcoin) (CoinTelegraph Brasil)
An alleged crypto pyramid called Data AI that operated an automated trading scheme was sued by 37 investors after freezing withdrawals - resulting in R$1.2 million in losses. (Livecoins)
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