Early adopters show blockchain’s big potential for Latin America

While many of the wealthiest economies remain somewhat wary of blockchain technologies, the eagerness of these emerging Latin economies likely …

There’s a reason Venezuela’s oil-backed cryptocurrency, the Petro, hasn’t been heralded by most experts as the solution to the country’s rampant inflation and political crisis. The Petro, by most accounts, isn’t backed by oil reserves – in actuality it’s backed only by a discredited government’s promise, launched in a region that has an unfortunate history of political corruption and currency manipulation.

But there’s also a reason why news about the Petro was met with a certain degree of intrigue, and even an amount of (extremely) cautious optimism. What if, some experts dared to imagine, such a cryptocurrency were introduced and implemented honestly and transparently? For a government facing hyperinflation and a total loss of public trust, what potential might a currency guaranteed by blockchain – with its unalterable, decentralized public ledger – have to restore consumers’ purchasing power, their ability to protect their savings, and their faith in the honesty of government institutions?

Beyond President Nicolas Maduro’s suspect plans for the Petro, the launch prompts us to explore a bigger story with implications that extend beyond Venezuela to the entire region. In Latin America’s emerging markets a lack of trust in financial and political institutions has long hampered financial inclusion, political participation, and entrepreneurial ambition. For this region, blockchain’s distributed and immutable ledger could go a long ways towards building faith in banking, the safety of personal savings and property, political processes, and the plausibility of entrepreneurial pursuits.

What’s more, while the media has focused on how blockchain and fintech will take hold within the wealthier economies, many Latin American populations, businesses, and government agencies from Argentina to Colombia are embracing blockchain, leading the way as early adopters. Here’s a look at the promise blockchain may hold for the region and those taking the lead in implementing these new technologies.

Blockchain’s far-reaching potential for the region

The eagerness of many early adopters across Latin America may be attributable to the fact that the region could stand to gain so much from blockchain. Blockchain tech is, by nature, especially capable of disrupting Latin America’s private and public sector.

To begin with, decades of cyclically unstable local currencies across the region have forced citizens to search out ways to protect their savings from rising consumer prices and currency controls. For the working class and the wealthy, new cryptocurrencies have appeared to offer an alternative to national currencies and a safeguard against inflation. Hence, 2017 saw a 1,000 percent rise in crypto transactions in Venezuela, and a 450 percent increase in Brazil amidst political turmoil. In Argentina, which is facing its own inflation crisis, the capital city of Buenos Aires is ranked among the top 10 cities with the strongest bitcoin presence.

At the same time, around 70 percent of the region’s population remains unbanked or underbanked, meaning they lack access to basic financial services like digital payments, money transfers, consumer lending, and individual investing. Blockchain-based fintech solutions could potentially offer financial alternatives to this unbanked segment.

While banks have traditionally been reluctant to serve the predominantly low-income unbanked due to this population’s lack of clear identifying information and the resulting difficulty of adhering to the “Know Your Customer” regulatory guidelines, blockchain-based fintech solutions can provide these citizens a digital identity for use in banking. Allowing citizens to bypass this bureaucracy, digital wallets could enable users in the region to participate in the ever-growing number of digital services being developed, from consumer loans to secure peer-to-peer payments.

Blockchain-based fintech platforms could thus help increase financial inclusion and empower a consumer market of an estimated 400 million unbanked or underbanked people. SMEs in the region could themselves use such platforms to tap this emerging consumer market and thereby achieve previously unattainable growth. All of this could mean greater financial literacy and even social mobility for citizenry, as well as economic growth for the region.

Finally, technology built on blockchain’s decentralized and unalterable ledger could hold the key to restoring citizens’ trust in public institutions, paving the way to more political participation and a healthier democracy. According to the OECD, three out of four Latin Americans today show little or no confidence in their national governments, and 80 percent believe corruption is widespread.

In areas of persistent corruption or political upheaval, government transactions occurring on a blockchain could ensure transparency, helping prevent the misappropriation of funds. In a region where political upheaval has jeopardized property rights, decentralized ledgers could protect asset ownership by keeping records from being erased or altered. And blockchain-based voting systems, which allow for an instant audit of election results and even enable voting by phone, could help prevent electoral fraud and voter intimidation at voting locations.

Early adopters in the private sector

Perhaps realizing blockain’s potential, both startups and larger companies in a number of Latin America nations are experimenting with implementing blockchain technologies across a variety of industries.

Argentina boasts burgeoning blockchain development ecosystems, with startups using blockchain technologies to transform financial exchanges and contracts. RSK Labs, for example, created a smart-contract platform connected to the Bitcoin blockchain, raising $3.5 million in Series A funding in 2017. They have partnered with the Universidad de Buenos Aires (UBA) to offer a blockchain curriculum.

Mexico and Brazil are hotbeds for crypto and fintech startups. Brazilian crypto brokers Bitcoin to You and Foxbit manage a large portion of exchanges for the country’s approximately 1.4 million crypto exchange users, while the Mexican exchange Bitso counts 500,000 users in a country where 80 million lack access to banking services. Meanwhile, big Mexican industries, from insurance to banking, are exploring ways to tackle inefficiencies with blockchain solutions.

Colombia’s private sector, too, is leading the way with early, innovative adoption. Startups like Portal Finance are designing blockchain-based tools to help businesses leverage data from electronic invoices, while the award-winning project Cycle aims to allow homeowners to earn crypto tokens for sharing surplus energy with communities in need. Bancolombia, Colombia’s second largest bank, has been at work testing open-source blockchain-based platforms and protocols since 2015. Much of its efforts have focused on working with local entrepreneurs from Colombia’s tech ecosystem, fostering blockchain exploration, and investigating the viability of a number of different use cases.

Building up more and more momentum, blockchain adoption in Latin America’s private sector could someday reshape industries and redefine services.

The Latin American governments testing blockchain-based tech

Some Latin American governments have been experimenting with blockchain-based applications too, testing applications within everything from healthcare and national identity management systems to banking services and internal revenue monitoring.

Beyond Venezuela’s controversial cryptocurrency, Mexico’s government has announced plans to conduct the first ever public procurement procedure on a blockchain network, helping guarantee transparency and accountability. In the same spirit, Brazil’s government has sought in blockchain a means of curtailing corruption and overhauling the country’s financial infrastructure. In 2018, the state-run tech company Serpro introduced a blockchain platform designed to regulate land titles, preventing corrupt officials from altering ownership records unnoticed. And last year, Brazil’s Central Bank began testing four crypto platforms: Quorum, HyperLedger Fabric, Ethereum, and Corda.

In Chile, the Ministry of Energy has begun using blockchain technology to authenticate and secure data from the national energy grid, hoping to restore trust with customers. The Santiago Exchange, Chile’s largest stock exchange, is also using blockchain to ensure the accuracy and security of transactions.

Finally, the Colombian government is looking to blockchain technologies in hopes of improving security and preventing fraud. To this end, the Colombian Central Bank met with blockchain software company R3 in 2017, making plans to test the firm’s distributed ledger technology. Meanwhile, Colombia’s newly elected president, Ivan Duque, has expressed interest in using blockchain technologies to promote political transparency. Some have suggested Colombia might use blockchain tech to help authenticate electronic voting.

A number of nations across Latin America, then, are proving themselves pioneers in the world of blockchain. While many of the wealthiest economies remain somewhat wary of blockchain technologies, the eagerness of these emerging Latin economies likely stems from the remarkable possibilities that blockchain opens up for their governments, entrepreneurs, and public. And promising everything from a hedge against inflation and political transparency to broader financial inclusion and efficient, secure remittances, blockchain and fintech may hold the key to unlocking the region’s true potential.

Dave Mejia is a senior blockchain strategist and engineer at Talos Digital.

Related Posts:

  • No Related Posts

Crypto Community Weighs In on ‘Creating a Better Bitcoin’ Debate as Academia Tout Latest Findings

A few days ago, news spread regarding the possibility to create a new Bitcoin (BTC), or at least, a better virtual currency. However, Bitcoin has been …
Crypto Community Weighs In on 'Creating a Better Bitcoin' Debate as Academia Tout Latest Findings

A few days ago, news spread regarding the possibility to create a new Bitcoin (BTC), or at least, a better virtual currency. However, Bitcoin has been working for more than ten years and it seems that it will keep operating in the future with new implementations and improvements.

Apparently, there are some University professors around the world that want to create a new digital currency which is backed by Credit Suisse and Pantera Capital. The Unit-e crypto will be launched this year and it might be able to process 10,000 transactions per second (TPS). This is more than five times faster than Visa, that processes 1,700 TPS on average. However, VISA can reach more than 45,000 TPS.

In order to process this large amount of transactions per second, the investigators tried to improve blockchain technology. However, there is no information about nodes or mining activities on the report released by the non-profit organization founded by the professors called Distributed Technologies Research. This non-profit is based in Switzerland.

Bitcoin has been growing in a competitive digital currency market during the last 10 years. It has been improved and developers behind it are trying to improve it and enhance it even further. At the same time, Bitcoin has thousands of miners and nodes distributed all over the world. Although Bitcoin continues to grow, there are several companies and projects that are trying to create a better version of Bitcoin.

In the future, Bitcoin will be improved with the Lightning Network (LN) which is going to allow the network to reach millions of transactions per second and reduce the congestion in the Bitcoin blockchain. Additionally, these transactions are going to be processed for very low fees.

Although the product can be technologically superior, this does not guarantee success for this project. Indeed, there have been several new technologies that were not adopted all over the world.

The Unit-e might not be able to succeed as they are expecting. Bitcoin has been embraced not only as a digital asset but also as a way to be against current governments and central banks. Additionally, enthusiasts use Ethereum (ETH) for smart contracts or Monero (XMR) for private transactions.

At the time of writing, Bitcoin is being traded around $3,600 and it has a market capitalization of $62.95 billion. In the last 24 hours, it lost almost 4% of its value.

Ethereum’s Constantinople Upgrade Now Scheduled for Late February

Participants in the call included Vitalik Buterin and other developers including Hudson Jameson, Lane Rettig, Afri Schoedon, Péter Szilágyi, Martin …

Ethereum’s Constantinople upgrade was originally planned to be released in 2018, was then pushed back to January 2019, and is now pushed back once again to late February 2019.

The decision to delay came about after the smart contract auditing firm, ChainSecurity, found security vulnerabilities in one of the 5 Ethereum Improvement Proposals (EIPs) set for inclusion in the system-wide Constantinople upgrade.

EIP 1283 was identified as the EIP with security vulnerabilities which are related to data storage costs on the blockchain. Now, Ethereum devs will test and refashion the EIP for inclusion at a later date.

Constantinople Upgrade Scheduled for February 27 at Block Number 7,280,000

On January 18, Ethereum core developers held a phone call where they discussed the Constantinople upgrade. Ultimately, they decided to go through with it around block number 7,280,000 which should fall on February 27, 2019.

Participants in the call included Vitalik Buterin and other developers including Hudson Jameson, Lane Rettig, Afri Schoedon, Péter Szilágyi, Martin Holste Swende, Danny Ryan and Alexey Akhunov.

The developers decided that it’s best that the Constantinople Upgrade is issued in 2 parts simultaneously on the mainnet. The first upgrade will include all 5 EIPs, and the second will remove EIP 1283 as it’s the one carrying the security vulnerabilities.

According to Ethereum developer Szilágyi, this strategy is to ensure all private networks that already implemented the full Constantinople upgrade can easily implement a fix without rolling back the chain.

As explainedby Szilágyi:

My suggestion is to define two hard forks, Constantinople as it is currently and the Constantinople fix up which just disables this feature… By having two forks everyone who actually upgraded can have a second fork to actually downgrade so to speak.

Related Posts:

  • No Related Posts

Zilliqa (ZIL) plunges -0.17% on January 19-20

Zilliqa (ZIL) had a bad 24 hours as the cryptocurrency declined $-3.74396999999992E-05 or -0.17% trading at $0.0226510185. According to Crypto …

Zilliqa (ZIL) had a bad 24 hours as the cryptocurrency declined $-3.74396999999992E-05 or -0.17% trading at $0.0226510185. According to Crypto Experts, Zilliqa (ZIL) eyes $0.02491612035 target on the road to $0.0482741497232676. ZIL last traded at BitMart exchange. It had high of $0.0230628552 and low of $0.0222766215 for January 19-20. The open was $0.0226884582. About 38,701 ZIL worth $886 traded hands.

Zilliqa (ZIL) is up 30.25% in the last 30 days from $0.01739 per coin. Its down -29.22% in the last 100 days since when traded at $0.032 and the annual trend is down. 200 days ago ZIL traded at $0.08811. ZIL has 12.60 billion coins mined giving it $285.40M market cap. Zilliqa maximum coins available are 12.60B. ZIL uses algorithm and proof type. It was started on 06/11/2017.

Zilliqa is an ERC-20 token based on the Ethereum blockchain.

Receive News & Ratings Via Email – Enter your email address below to receive a concise daily summary of the latest news and analysts’ ratings with our FREE daily email newsletter.

Related Posts:

  • No Related Posts

Top 10 Friendly Countries for Blockchain Startups

Blockchain has been a revolution in the digital market for the last couple of years. It has occupied an important place in the digital currency revolution.

Blockchain has been a revolution in the digital market for the last couple of years. It has occupied an important place in the digital currency revolution. The growth of technology has touched various fields such as smartphones, vehicles, shipping and a small sector in the sector of banking.

Although there is no country in the world which is not aware of this technology, there is a huge difference of opinion among countries regarding this revolution. There are various factors a blockchain startup has to look up before deciding it as a host country such as the jurisdiction regulations of the country, political views, tax system etc as these factors are going to affect the growth of any startup. While some countries are allowing blockchain startups to set up legally, while some are in no mood for any such beginning in the country and there are also some countries which are not sure about it.

Let us take a glance at the top 10 friendly countries for blockchain startups:

1. Malta:

This small Mediterranean country is on the verge of becoming the ‘island of blockchains’. The beginning of all these was when the biggest cryptocurrency exchange of world, Binance chose to inaugurate its office in this country. Also, they have informed all to set up a ‘crypto’ bank on this island.

Malta has been improving and enhancing new regulations that are friendly for blockchain startups. The country is so much dedicated to this technology that even the head of the country, the Prime Minister has predicted that the country will be the best place for this kind of startups throughout the world. The regulations are mainly focussed to evolve and encourage the investors to start this kind of projects in the country.

2. Switzerland:

The settling up of a crypto valley in one of its town, Zug, is sufficient to describe how much amiable this country to blockchain startups. It is one of the famous center of blockchain technology across the globe. Adding to the ice, they have imposed a tax-free regulation for the investors who want to invest in this kind of startups. Apart from it, their laws and regulations are very attractive and appreciated by investors as well as developers.

It has been the host of several blockchain projects including DFINITY, Xapo and of course, Ethereum. The privacy rules and protection of data are also appreciated by the blockchain startups.

3. Japan:

Japan is one of those countries which have approved cryptocurrency such as Bitcoin as a legal tender. It has been home of several blockchain traders, even some of the stores in the country have no problem in taking payments from users as Bitcoin currency. After six months of recognizance of cryptocurrency as legal, Japan is now accountable for more than half of total such trades.

Although there are various regulations regarding blockchain startups, they are friendly and easy to be acceptable and it’s not difficult to stary sich any startup in the country.

4. Singapore:

This country is a home of a huge number of triumphant startups in the field of blockchain technology. This country is nearer to two super giant technology rival countries Japan as well as China which makes it a more suitable center for startup of blockchains. The rules and regulations of this country are also very amiable and favorable bt the cryptocurrency. It has already a lot of exchanges of blockchain currency. So if a blockchain startup is willing to start and want to be in touch of both China and Japan clients and government, Singapore is the best country.

5. Belarus:

Two years back itself in 2017, this country made several rules and regulation affecting blockchain and crypto industry. As per these laws, they have made these digital currencies as the legal one in the country. The restrictions in the trade related to blockchain technologies are so friendly that the investors almost feel free to start any such startup or invest in this kind of organizations. Also, as per the rules, these kinds of trades are tax-free in the country until 2023. Due to the friendly rules and success, it is one of the preferable countries for blockchain startups.

6. Estonia:

Estonia is a developing country which has always tried to adopt new technologies in order for the benefits of the people and finance of the country. It has imposed several acts that attract the investors of the country as well as other countries to set up a blockchain startup in this country. It has declared itself to be a remarkable country in blockchain technology very soon. Also, they have established a new kind of citizenship known as e-residency which also attracts blockchain startups.

7. South Africa:

This country has depicted a tremendous interest in blockchain technology. They have made the crypto transactions as legalized one in the country. They have made several initiatives in order to attract the investors to start such startup in South Africa. The rules and regulation related to this crypto market in this country are also not so harsh, they always tend to welcome these industries. It is becoming as one of the most profitable countries for blockchain startups in Africa subcontinent.

8. Denmark:

Denmark has already announced a regulation stating complete relaxation in tax for any kind of blockchain trade. It is one of the most amiable countries for welcoming these types of startups in the country. The rules of the country are very friendly for the crypto industry making it one the interest for blockchain startups.

9. United States:

When it comes to adopting new technology in the market, this country is always in the front. The rules and regulations vary across different states of the country. Despite the oppose in some state, there are Bitcoin ATMs in the country. The friendly states of the county, Montana, Texas, etc. have very amiable regulations while welcoming the blockchain startups. Apart from it, no other country in the world can be better for any technology to start other than the US itself.

10. United Arab Emirates (UAE):

This Arabian country is also one of the most friendly nations. They have already used their own digital currency since 2016 and now welcoming global cryptocurrencies. The jurisdiction is very cooperative towards the blockchain and crypto industry. They are planning to be the first country in the world as a government powered by blockchain by next year. Due to these reasons, UAE is also one of the most preferable countries for blockchain startup.

The market conditions of countries continue changes. The expansion of crypto and interest in blockchain startups is so high that many countries are willing to accept it in their country. There are various factors to establish the startup in the country and initial requirement would be an amiable regulation and legalization. Apart from above-mentioned countries, UK, Sweden, China, South Korea etc. are also preferable.

Related Posts:

  • No Related Posts