BeInCrypto's comprehensive Latin American Cryptocurrency Roundup brings you the most important news and trends from Latin America. We cover the latest updates and insights from the cryptocurrency industry in the region with reporters from Brazil, Mexico, Argentina and beyond.
This week we'll cover Brazil's Bitcoin Pharaohs, Botev Plovdiv FC's move to issue tokenized shares in El Salvador, and more.
El Salvador and Russia strengthen economic cooperation: Bitcoin could be on the agenda
El Salvador and Russia announced plans to strengthen economic cooperation at the St. Petersburg International Economic Forum. Salvadoran Vice President Felix Ulloa has proposed strengthening trade ties and establishing mutual embassies, potentially reshaping the two countries' economies.
Russia, under sanctions from the United States and the European Union following its 2022 invasion of Ukraine, is seeking new trading allies. El Salvador is cooling ties with the United States and strengthening ties with China under President Nayib Bukele .
Geopolitically, an alliance with Russia could strengthen El Salvador's global standing, making it less dependent on the United States and solidifying ties with emerging powers such as China and Russia. Economically, El Salvador aims to balance its trade deficit with Russia, as evidenced by President Ulloa's statement that the country will import $16 million from Russia in 2021, with no corresponding exports.
Read more: 3 Ways to Send Cross-Border Money Using Cryptocurrency
Technologically, El Salvador aspires to be a hub for innovation. Collaborations with Russian technology companies can support these ambitions. Bitcoin's role in particular is critical to this potential partnership. As the first country to adopt Bitcoin as fiat currency, El Salvador's digital asset law and the establishment of a Bitcoin bank could facilitate trade with Russia by bypassing traditional fiat currencies controlled by central banks.
This economic cooperation could redefine El Salvador's position on the global stage by providing new opportunities in trade, technology and digital finance.
Will Brazil's 'Bitcoin Pharaoh' remain in prison after the Supreme Court ruling?
Brazil's Federal Supreme Court on June 11 upheld the prison sentence of Gladson Acacio dos Santos, known as the 'Pharaoh of Bitcoin'. Santos, who is accused of running a cryptocurrency scam through his gas consultoria, was arrested during federal police's Operation Cryptos in 2021.
Santos' attorneys filed a motion for habeas corpus to have his incarceration converted to house arrest, citing psychiatric issues and questioning the jurisdiction of federal courts. But Judge Gilmar Mendez rejected the request. While he acknowledged that pyramid schemes generally fall under state jurisdiction, he noted that federal courts may intervene in cases involving crimes involving the state's financial system.
Santos faces several charges, including financial pyramiding, fraudulent management, fraudulent securities issuance, unlicensed operation, and criminal organization. His scam promised victims a 10% monthly return on their cryptocurrency assets.
This decision follows the recent arrest of another ‘Bitcoin Pharaoh’, Claudio Barbosa, on charges of running a pyramid scheme through trust investments. Barbossa has been on the run since 2022 and is accused of causing losses of 4.1 billion reais to investors in more than 80 countries.
Read more: 15 most common cryptocurrency scams to watch out for
Bulgarian Football Club Botev Plovdiv Issues Tokenized Shares in El Salvador
Bulgarian football club Botev Plovdiv FC has announced plans to move its cryptocurrency operations to El Salvador through brokerage Bitfinex. The club adopted Bitcoin as a payment method in October 2023. It relocated its operations to benefit from El Salvador's tax incentives and favorable business environment and to access new capital markets.
Botev Plovdiv has set up a financial entity in El Salvador to issue tokenized shares, said George Manolov, the club's Bitcoin strategy leader. This arrangement allows investors to become co-owners of the club.
Read more: What is tokenization in blockchain ?
“We want Bitcoin to be the primary long-term financial strategy for our business. We are here in El Salvador to accumulate BTC by issuing tokens and to enable fans to participate in the process of becoming a recognized club in Europe. We are working with Bitfinex Securities to democratize stocks, and investment tickets will be very affordable. Anyone can become a co-owner,” Manoloff explained.
Manolov discussed this new business model in a presentation in Bulgaria and will share it at the BTC Prague Forum. He explained that tokenization allows Bitfinex securities assets to be efficiently stored, transmitted, and managed through the Liquid Network, a Bitcoin sidechain.
Brazil's Largest Private Bank Expands Access to Bitcoin and Ethereum
Itaú Unibanco, Brazil's largest private bank, has expanded its cryptocurrency services, allowing customers to trade Bitcoin and Ethereum through its digital platform Íon. With over R$2.7 trillion in assets, the bank aims to make access to these top cryptocurrencies simpler and more secure.
The scheme will be rolled out gradually from the end of 2023 and has received positive customer feedback. In an internal survey, over 90% of users rated their experience as good or excellent. Now all active users of the Aeon platform can trade cryptocurrencies with a minimum contribution of R$10.
“We are very satisfied with the crypto asset journey we are creating together with our customers. Opening trading to all Ion users reflects the evolution of not only our products, but the entire market,” said Guto Antunes, Head of Itau Digital Assets. He emphasized eTau’s commitment to providing intuitive and secure cryptocurrency trading.
E-Tau also aims to educate its customers about the cryptocurrency market so they can make informed investment decisions. The move brings Itau in line with other Brazilian institutions such as BTG Pactual and Nubank that are already offering cryptocurrency exposure to their clients.
Read more: Cryptocurrency vs Banking : Which is the smarter choice?
El Salvador overcomes IMF concerns and reaffirms Bitcoin agenda
El Salvador's Vice President Felix Ulloa reaffirmed the country's commitment to Bitcoin as it aims to free the economy from central banks. El Salvador has been accepting a variety of tokens and cryptocurrencies since enacting a digital asset law last year.
Minister Ulloa expressed confidence that Bitcoin can reach $100,000 by the end of 2024, demonstrating El Salvador's pioneering role in incorporating Bitcoin into an exchange-traded fund (ETF) ahead of the United States.
El Salvador has diversified its funding sources beyond traditional multilateral institutions, despite initial criticism from the International Monetary Fund (IMF) and credit rating agencies. This strategy strengthened the country's credibility and attracted digital economy companies through a supportive regulatory framework.
Read more: Who will own the most Bitcoin in 2024?
El Salvador recently celebrated three years since adopting Bitcoin as its legal tender. El Salvador purchases 1 Bitcoin every day, accumulating up to 30 BTC each month. These investments resulted in unrealized gains of more than $67 million .
Prominent investors such as ARK Invest CEO Cathy Wood believe that President Bukele's Bitcoin strategy could significantly boost the country's GDP over the next five years. Ulloa acknowledges that the IMF continues to monitor Bitcoin law, demonstrating ongoing discussions about the associated risks and benefits.
As the cryptocurrency market in Latin America grows, these examples demonstrate the growing influence of Latin America in global markets. From El Salvador's Bitcoin plans to a Brazilian bank launching cryptocurrency trading, Latin America is establishing itself as a key player in the world of technology. Stay tuned for more updates and insights in next week's recap.
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