51% of Latin American consumers have conducted at least one transaction with crypto assets, and over 33% of them have used stablecoins for everyday purchases, according to the latest survey conducted by digital payment giant Mastercard.
Entitled “New Payments Index 2022,” the study focuses on financial innovations such as cryptocurrencies, DeFi solutions, blockchain, and NFTs and aims to evaluate consumer behavior regarding emerging payment methods.
Latin Americans Interested in Cryptocurrencies
Per the survey, In Latin America, 54% of Latino consumers are optimistic about the performance of digital assets as an investment. Meanwhile, two-thirds of Latinos want a hybrid payment option that includes both crypto and traditional payment methods for their day-to-day operations.
Besides, Latinos were actively driven by financial products associated with cryptocurrencies. 82% said they would like to “have cryptocurrency-related functions available directly from their current financial institution.” Moreover, a majority of consumers in the region felt more comfortable dealing with “trusted organizations” when it came to crypto payments and investments.
Compared to Europeans and Americans, Latinos have demonstrated a higher degree of flexibility and willingness to adopt new payment options. As opposed to over 75% of consumers in Europe and America preferring traditional payment methods, 86% of Latinos used at least one emerging payment method, such as biometrics, digital currencies, and QR code, last year.
Mastercard Latin America and the Caribbean’s executive vice president commented on the consistently rising interest in new digital payment methods, stating:
“The future of payments is already here. Increasingly Latin Americans are turning to technology to conduct their financial transactions and this trend is expected to continue to rise, with an overwhelming 95% planning to use a digital payment method in the coming year and 29% acknowledging having used less cash in the past year.”
Financial Instability Drives Crypto Adoption
Financial instability and rising inflation may have been the major causes behind some South American countries diving deep into digital assets. Plagued by the domestic currency peso plunging amid rampant inflation, over 73% of Argentinians viewed cryptocurrencies as the most efficient saving mechanism two years ago. This perspective corresponds to the popular view that Bitcoin is a hedge against inflation, or simply, a digital gold that is also a store of value.
Venezuela – heavily sanctioned by the US government and banned from accessing major international payment services – took cryptocurrencies as not only a store of value but a means to send and receive money, bypassing economic sanctions. Blockchain analytics firm Chainalysis’s report on such an issue stated:
“The country has reached one of the highest rates of cryptocurrency usage in the world, placing third on our Global Crypto Adoption Index, as many Venezuelans rely on cryptocurrency to receive remittances from abroad and preserve their savings against hyperinflation.”