ForexMinute.com – Adopted as a new kind of financial application, Bitcoin is gradually garnering a noteworthy place in Brazil by approaching the country’s retailers. The worldwide presence of this particular digital currency is well-known among Brazil’s merchants, and Bitcoin utilizes this attention at full scale and is luring them by offering services at rates lower than those charged by credit card companies.
Launched in 2008, Bitcoin is one of the hottest topics inside and outside of the financial sector. Its decentralized nature have made many fans, as well as critics. Brazil is one such place which holds a population of both of them – the ones who are in favor of Bitcoin and the ones who are simply against it.
It is estimated that over $240 million worth Bitcoin has been transacted from the world’s largest Bitcoin exchange BitStamp, based in Slovenia. In Brazil alone, over $10-million worth of Bitcoin is transacted per month at the country’s largest virtual currency exchange Bitcoin Market.
There are also other cryptocurrency exchanges in Brazil that are working continuously towards introducing Bitcoin to the local market as well. Apart from Bitcoin Market, there is Bitcoin To You, Usecryptos and Bitinvest are making sure to present Bitcoin as a new form of investment or mode of funds remittance abroad.
Bitcoin To You is specially initiating meetings with major retailers in Brazil to convince them to accept virtual currencies as one of their payment methods. Accepting Bitcoin or any other form of virtual currency will save these retailers from paying too much transaction fees (which amounts 6 percent for credit cards, and only 2.5 percent for Bitcoin).
As a result, there are over 50 shops and establishment of small and medium sized companies in Brazil that has begun to accept Bitcoin, with two organizations in the country’s economic center Sao Paulo itself. The Bitcoin To You founder Andre Horta have also spoken about leading retailers like Tiger Direct and Overstock which has earned over $1 million this year alone in the payments via virtual currencies.
“The Bitcoin can be very revolutionary,” said Rodrigo Batista, a partner of the Bitcoin market. The executive believes that, over time, stocks will migrate to the business of means of payment. The Bitcoin market itself will launch this month while focusing on services for physical and online stores. The company is in the testing phase with three e-commerce stores, he also said.
Bitcoin Under Brazillian Laws
One of the main challenges for the acceptance of Bitcoin as an investment or as a means of payment is the fact that electronic currency cannot be regulated by the Central Bank or by the Securities Commission in Brazil.
In a statement published in February, the Central Bank of Brazil said that the virtual currencies have no guarantee of the actual conversion. “There is therefore no government mechanism to ensure the value in its currency, the risk of getting all their acceptance into the hands of users.”
The Bitcoin wallets are also vulnerable to cyber-attacks. The best known example of this is Mt Gox, a Japanese exchange which was the base of the world’s largest Bitcoin transactions prior to bankruptcy.
There are various challenges Bitcoin will have to face to win Brazilian retailers trust before becoming a full-fledged alternative to their traditional currency. News are that Brazil government is also hoping to follow IRS and name Bitcoin as a property rather than a currency.
To contact the writer of the article: Yashu Gola at firstname.lastname@example.org