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Despite inflation and monetary policy changes in the United States that have had a negative impact on investments, Latin America continues to lean towards the use of cryptocurrencies as a means to achieve greater financial inclusion and is emerging as an attractive region to promote blockchain technology.
Among other things, this seems to be ratified by the more than 1,200 people who attended the Blockchain Summit Latam 2022 in Panama, which aimed to highlight the region as one of the most blockchain-friendly in the world, where countries like El Salvador or Panama could emerge as a crypto hub in the future.
While there are compelling data, such as studies that indicate that 51% of Latin consumers have transacted with cryptocurrencies in the past year, it is more impressive to see hundreds of participants from across the continent gathered at the Blockchain Summit Latam, which in its sixth edition, which took place from July 6 to 8, served as a platform to promote learning, analysis and identification of opportunities for using the blockchain technology.
The event was held in Panama City, which became the blockchain capital for a few days (July 6-8), with over 130 exhibitors in the new, state-of-the-art Panama Convention Center.
“Part of what we’re doing with this event is for everyone to meet and connect,” said Cristobal Pereira, CEO of consulting firm LatAmTech Finance and general organizer of the summit. “Live the experiences and, in a way, visualize the opportunities that this technology offers to Latin Americans.” For Pereira, the volumes of cryptocurrency transactions in the region are increasingly exciting and deserve more events like this, where, he said, some 250 business meetings were held. recorded.
Considering that analytics firms such as Triple A and Grandview Research forecast the blockchain industry to grow 86% globally between 2022 and 2030, it’s safe to say we are witnessing the first steps of an industry of endless possibilities. And while we also believe that LatAm has the highest concentration of cryptocurrency users in the world, the future looks bright for the region and platforms such as this.
CJ Rinaldi, CCO of Blockchain.com, said at the event that the last two years have seen a massive expansion of the crypto sector around the world and that he sees Latin America as a high growth market in due to the impact of factors such as inflation. , political instability and distrust of banking institutions have on its population.
“Latin America has 200 million unbanked citizens who turn to crypto as a store of value, safe and stable, and an entry point to financial freedom,” Rinaldi said after recalling the cases of the Argentina and Venezuela, where the use of cryptocurrencies has increased dramatically. faced with the fragility of their local currencies. “Latin Americans are progressive and innovative in their adoption of new technologies, and we expect the numbers to grow.”
For his part, Maximiliano Hinz, Latam Director at Binance (one of the largest cryptographic platforms in the world), pointed out that the use of this technology is not limited to digital currencies: it also has an impact on the processes of traceability, logistics tracking, digital art and process and inventory control, across the continent.
Panama, a possible hub for the region
The fact that the meeting took place in Panama was no coincidence. It aimed to elevate the Isthmian nation for the critical boost it is giving to the blockchain ecosystem and the use of cryptocurrencies in recent years, presenting itself as a possible crypto hub in the region.
“The possibility of exporting services, and since the currency used by Panama is the dollar, it allows you to start a business with fewer restrictions than in the United States”, explained Cristóbal Pereira, pointing out that the advantages for the international investment are notable in Panama, which potentially puts them above other crypto-friendly countries.
Thanks to these advantages, Panamanian companies and organizations are organizing themselves more every day, seeking a regulatory framework that gives confidence and credibility to operations with digital currencies that can be carried out from Panama.
For this reason, organizations such as the Chamber of Digital Commerce and Blockchain – which since 2018 has had six companies on its board of directors and has collaborated with several companies, banks, associations, chambers and government entities – have emerged on the panamanian technology map. connect government, private sector and civil society to achieve the establishment of a blockchain industry strong enough to make the country a model to follow.
Rodrigo Icaza, executive director of the Chamber, says that to achieve this objective, “there is a great effort of training and education, negotiations, analysis and filters of the actors who really add value to the development of industry”. He also thinks blockchain could have a positive impact on Panama’s GDP.
Although Panama partially maintains its veto of the so-called cryptography law by the national executive, the efforts to have a regulation do not stop. The various groups that support the use of this technology believe that the next step is to become a cryptocurrency hub in the region by strengthening the internal ecosystem.
“You don’t need a law to achieve goals either,” Icaza says. “As long as they stay within the ethics and good deeds of people. But, if a law embraces and protects development and innovation, welcome.
Education is the cornerstone
While it is true that being a financial and logistics hub makes Panama a strong candidate to be a magnet for fintechs, crypto-asset exchanges and other related companies, another country has accumulated significant experience in the use of digital currencies: El Salvador.
The experience of Central America’s smallest country, which passed the Bitcoin law in June 2021, may not yet be fully dimensioned, as Monica Taher, director of international technology and economic affairs at the Secretariat of Commerce and the investment of the presidency of El Salvador. , explained during his intervention in this event. However, what is very clear is that one of the critical factors for this country to adopt Bitcoin on a daily basis and at all times is “education”.
“The educational process is progressive at the moment and should not be the sole responsibility of the government. It must fall on the triple helix: government, academia and the private sector,” Taher said. The expert invited these sectors to be part of this significant change in all countries that wish to adopt the use of cryptocurrencies. “Education must be the pillar for any nation to be able to massively adopt bitcoin or any other option,” she insisted.
On the other hand, she highlighted the importance of private enterprise in the experience of El Salvador. For Taher, the ecosystem can only emerge with the support of this sector, as it will allow giving more options to different projects and “making El Salvador a crypto hub for Latin America”.
Taher assured that El Salvador’s goal is to comply with a plan that allows them to continue strengthening a legal framework conducive to achieving financial inclusion and a decentralized financial ecosystem.
Although El Salvador is the first country in the world to approve bitcoin as legal tender and has more than 200 virtual currency ATMs installed throughout its territory, 82% of its population still have little or no trust to bitcoin. For this reason, the Salvadoran authorities continue to promote education to encourage the more than 6.5 million Salvadorans in the territory (in particular 70% of the unbanked population) to use this currency in their daily lives.
The experts and specialists who participated in the Blockchain Summit Latam made it clear that the use of blockchain technology is not limited to cryptocurrencies. Opportunities for the region also include digitization of banking, logistics, real estate tokenization, identity protection, smart contracts, use of wallets (digital wallets), which are increasingly easy to find in the different countries of the continent and, of course, the purchase of NFT, among many other possibilities.
They also concluded that more and more Latin American companies and users are taking advantage of this technology in their daily lives as a natural way to achieve financial inclusion and protect their economy. Therefore, they believe that the region must continue to work on education and build a real ecosystem that integrates regulators, companies, financial institutions, chambers and all sectors that can open this vital path in the region.