Latam Crypto Report #17: A Crypto City Pops Up in Buenos Aires

Also: All eyes on Worldcoin; Venezuela temporarily blocks Binance and other sites after elections

Hola a todos! 👋

Welcome back to 🌎Latam Crypto Report, where contributor Kristin Majcher rounds up and digests the biggest crypto stories in the region. We’ll cover the biggest news from late July until late August.

In this edition, we’ll take a look at:

• The pop-up crypto city Aleph, which took hold of Argentina’s capital in August

• Why Worldcoin is attracting scrutiny from governments in Chile, Colombia and Argentina

• The events leading up to Venezuela’s state-owned ISP temporarily blocking Binance and other sites after its presidential elections

Whether you’re gearing up for fall in the Northern Hemisphere or getting ready for spring somewhere south of the equator, we thank you for reading our overview of the Latin American crypto landscape. Please smash the “subscribe” button below and ask your friends to follow our newsletter. Also, feel free to follow Kristin on Twitter and LinkedIn to share any crypto news or say hello.

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Pop-Up Crypto City Aleph Transforms Buenos Aires

August might be the dead of winter in Buenos Aires, but Argentina’s Crecimiento crypto movement proved it is just heating up after gathering thousands of people to experience its pop-up city, Aleph. The movement aims to put Buenos Aires on the map as a worldwide crypto hub, and the monthlong event provided the first glimpse at how this may look in practice.

Crecimiento estimates that more than 2,000 participants have flocked to the pop-up city in Buenos Aires’ hip Palermo neighborhood, which opened on August 5 and is just now wrapping up. Sixty-eight startups gathered to test real-world use cases for crypto applications, and a running list of side events provided opportunities to connect over wellness, art, and — of course — asados. 🥩🧉

Catalyzed by Protocol Labs founder Juan Benet, Aleph featured talks from builders and leaders from teams such including ZKsync, Matter Labs, Worldcoin, Avalanche, Ripio, Lemon, Belo, Aztec Network, and more. The event’s regulation day also drew in government officials including former president Mauricio Macri and Roberto Silva, the president of Argentina’s securities regulator Comisión Nacional de Valores (CNV).

“It’s much more than a hackathon,” the City of Buenos Aires’ Innovation Secretary Diego Fernández told Brazil Crypto Report in July during a podcast interview. “It’s living the experience of being together [for] one month, collaborating, creating, thinking.”👇

The Bankless team was on site throughout the month and created some great content highlighting Argentina’s crypto movement. Be sure to catch this episode with Marcelo Cavazzoli of Lemon, Federico Ogue of Buenbit, and Manuel Beaudroit of Belo👇

Be sure to watch this space for more updates on the Crecimiento movement and more developments from Aleph. (Ámbito, CoinDesk, La Nación, BeInCrypto, Criptotendencias)

Governments Eye Worldcoin’s Data Collection Methods

In the past few weeks, Worldcoin has attracted scrutiny from several Latin American governments concerned about the crypto-focused identity project’s data collection methods. Since touching down in Argentina last year, Sam Altman’s unique endeavor has also expanded into Chile, Ecuador, Mexico, Perú and Colombia.

As millions of people worldwide allow Worldcoin’s orbs to scan their eyeballs in exchange for cryptocurrency, governments are also keeping a close eye on the project. Their concerns largely center on how Worldcoin and its affiliated companies collect and store biometric data and notify users about how they plan to use that information. Here are some updates from the past few weeks:

• Argentina’s Buenos Aires Province announced on July 24 that it had levied an ARS194 million fine (more than $200,000) against Worldcoin, ordering it to remove what it describes as “abusive clauses” from its contracts. It previously mentioned a potential maximum fine of more than $1 million in April. (Buenos Aires Province, Portal do Bitcoin, CriptoFacil, BeInCrypto, Exame)

• Chile’s consumer protection authority (SERNAC for its Spanish acronym) said on August 28 that it would file a formal complaint against Worldcoin (Grupo Optimistic SpA) after finding what it claims is a “series of irregularities” in its data collection methods. The authority warned that Worldcoin could face having to close its operations in the country if it does not fix the issues, as well as potential fines for at least three infractions totaling up to CLP60 million (more than $65,000). (Sernac, BeInCrypto, BioBioChile, CriptoNoticias)

• Colombia’s regulator overseeing personal data protection said on August 20 that it is also investigating Worldcoin and associated company Tools for Humanity for allegedly violating the country’s data protection regime. The company could face temporary closures and potential fines of up to 2,000 minimum monthly salaries (about $630,000) if it is found to be violating any rules. (Semana, Bitcoin.com, The Block, CoinDesk, Rest of World, W Radio)

• In a statement cited by local media outlets, Worldcoin said it will “continue to uphold the highest standards of data privacy protection, fully complying with all applicable laws and regulations in the markets where we operate. This includes, but is not limited to, the Colombian Personal Data Protection Law.”

Venezuela Temporarily Blocks Binance and Other Sites After July Elections

Binance was one of the websites blocked by Venezuela’s state-run internet provider in the weeks after strongman Nicolás Maduro’s highly contested July 28 presidential election. Venezuela has seen a surge in crypto remittances in recent years, and Binance is a major player in the region.

• Digital rights organization VE Sin Filtro posted on August 9 that the state-owned IP address CANTV had blocked Binance, Cointelegraph reported. The news outlet said that the webpage was working normally by August 12.

• In an August 10 X post, Binance Latinoamérica confirmed that the platform’s pages “have been facing access restrictions” and assured its customers that its funds were safe.

• VE Sin Filtro noted on August 13 that Binance was one of several websites blocked between August 9 and 11, along with pages including Mercado Libre Venezuela as well as various streaming platforms and news sites.

• These blocked websites appear to have stemmed from the ISP blocking the content delivery network AWS CloudFront, VE Sin Filtro said.

• Venezuelans shared tips on using VPNs to get around the blocks, BeInCrypo noted.

(Forbes, Bitcoin.com, VE Sin Filtro, Cointelegraph, Livecoins, Exame, BeInCrypto, CoinDesk, Portal do Bitcoin)

🗞 Latin America Crypto News Rundown

Here’s where we break down Latin America crypto headlines from the past few weeks, organized by country and region. If you don’t see a country listed, it’s simply due to the news flow during a particular week.

Regional News

• LATAM-focused crypto exchange Bitso picked Coincover to offer security services. (CoinDesk)

• Bitso also released a new report detailing fresh findings about the LATAM crypto landscape. (BeInCrypto)

• El Salvador-based exchange eNor Securities will offer Backed’s “bTokens” for Latin American retail users. (CoinDesk, The Defiant)

• Bitcoin mining company Bitfarms — which has assets in Paraguay, Argentina, the US and Canada — announced it would acquire Stronghold Digital Mining. (The Block, CoinDesk)

South America

🇦🇷 Argentina

• High school students in Buenos Aires can now learn about Ethereum and blockchain technology as part of their curriculum. (Bankless via X, BeInCrypto, Livecoins, Cointelegraph)

• Bybit received its virtual asset service provider (VASP) registration. (Cointelegraph)

• Law firm Allende & Brea said it registered Argentina’s first company formed with cryptocurrency capital. (Allende & Brea, CriptoFacil, Infobae, Portal do Bitcoin)

• Nineteen-year-old crypto trader Franco Saulle was killed. (Livecoins, Ámbito, La Voz)

• Argentina’s Federal Police force said it captured a Russian hacker accused of running an international network to launder crypto assets. (Argentina’s Security Ministry, Portal do Bitcoin, Livecoins)

🇨🇴 Colombia

• Financial institutions are exploring cryptocurrencies, despite slow progress on national regulations. (Portafolio, BeInCrypto)

• A token called Kmushicoin is playing a key role in exporting beetles. (France 24, Exame, Cointelegraph)

🇪🇨 Ecuador

• Ecuador’s central bank reminded citizens on August 12 that crypto is not legal tender and that trading it can generate “significant losses.”

• The press release prompted its general manager Guillermo Avellán to clarify that the bank has not prohibited the use of crypto, as doing so would fall outside its purview. Avellán added that the country needs a crypto regulation to protect investors. (CriptoNoticias, Primicias, Livecoins, Portal Do Bitcoin)

🇵🇾 Paraguay

• Kristin (the author of this newsletter!) examines how a hike in electricity tariffs has affected Paraguay’s various crypto mining companies. (Southern Pulse Substack)

• While the president of Paraguay’s state grid operator downplayed reports that crypto mining companies were considering leaving the country after the tariff hike, local media outlet ABC recently cited another official saying nine firms were going to be disconnected because they did not pay their bills or did not want to continue mining. (CriptoFacil, BeInCrypto, ABC CriptoNoticias)

🇵🇪 Perú

• Perú’s financial regulator approved a resolution to prevent money laundering, which includes measures that apply to virtual asset service providers (VASPs) operating in the country. (Bitcoin.com, Infobae, Portal do Bitcoin)

• The US Justice Department organized a workshop for nearly 90 prosecutors from across Latin America about combating crypto-related crime. (Cointelegraph, BeInCrypto, U.S. Embassy in Perú)

🇺🇾Uruguay

• Bitcoin-powered real estate transactions are gaining interest in Uruguay after a notable sale, BeInCrypto reported. (BeInCrypto)

Central America, Mexico & Caribbean

🇧🇸Bahamas

• The Bahamas’ Parliament passed the highly anticipated Digital Assets and Registered Exchanges Act, 2024 (DARE 2024), which marks the first major update to the country’s digital asset law since the FTX collapse. (Bitcoin.com, CoinDesk)

🇩🇴Dominican Republic

• The Dominican Republic’s bank superintendent Alejandro Fernández emphasized that crypto is not legal tender and discussed banking digitalization in a video interview. (CryptoNoticias, Acento)

🇸🇻 El Salvador

El Salvador’s President Nayib Bukele is on the cover of TIME this week.

While Bukele admitted that bitcoin “has not had the widespread adoption we hoped,” he said that “it gave us branding, it brought us investments, it brought us tourism.”

As lobbyist Damian Merlo put it:

“We call it the Great Rebranding. It was genius. We could have paid millions to a PR firm to rebrand El Salvador. Instead, we just adopted Bitcoin.”

(TIME, Cointelegraph, CoinDesk, BeInCrypto)

• The International Monetary Fund (IMF) said that while many risks of bitcoin “have not yet materialized” in El Salvador, “there is joint recognition that further efforts are needed to enhance transparency and mitigate potential fiscal and financial stability risks from the bitcoin project.” (IMF Staff Statement, Portal do Bitcoin, Livecoins)

• Turkey’s Yilport Holding will invest $1.6 billion to build two new ports in El Salvador, one of which will be in the area where the government had proposed creating Bitcoin City in 2021. A video of the project the president shared on social media did not mention that city. (Portal do Bitcoin, Cointelegraph, CriptoNoticias, BeInCrypto)

• El Salvador will offer bitcoin training to about 80,000 civil servants. (Diario El Salvador, Livecoins, Cointelegraph)

• El Salvador’s bitcoin reserves total about $348 million at current prices, data from Arkham Intelligence shows. As of August 23, the country had added 162 bitcoins through daily buys since March, CoinTelegraph reported. (Cointelegraph, Exame, Portal do Bitcoin, CriptoFacil)

• Buklele proposed reforming bitcoin-related laws to comply with the Financial Action Task Force’s (FATF’s) anti-money laundering recommendations, CriptoNoticias reported. (CriptoNoticias)

🇲🇽 Mexico

• A new project in Isla Mujeres called BTC Isla aims to create a circular bitcoin economy on the island. (Portal do Bitcoin)

• CoinFlip has expanded into the country, adding its crypto ATMs in more than 20 locations around Mexico City. (Bitcoin.com, BeInCrypto, ATM Marketplace)