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FTX collapse won’t impact everyday use of crypto in Brazil: Transfero CEO

The crumbling of the FTX crypto empire may have damaged Brazilian retail and institutional sentiment toward crypto. However, its impact won’t affect everyday citizens — who will still use crypto for cross-border transactions. Reflecting on the recent fall of FTX, Thiago César, the CEO of fiat on-ramp provider Transfero Group said that the exchange’s fall, like in many countries around the world, has hurt confidence around centralized crypto exchanges and crypto in general.

Transfero Group is tied in closely with the Brazilian crypto ecosystem and FTX as it was the fiat on-and-off-ramp provider for the exchange and is also the issuer of Brazilian Stablecoin BRZ, which was listed on the now-defunct exchange. César told Cointelegraph that the collapse of the exchange had removed a “big liquidity source” from the market, as FTX was ranked within the top three in terms of trading volume. He also noted that uncertainty surrounding centralized crypto exchanges caused a “big outflow of funds” from exchanges in Brazil, with many looking into self-custody — estimating at least 20% of trading volume has been lost on exchanges so far.

César noted the FTX saga will make crypto investment a “harder sell” for new investors and traders. “For the crypto investor/trader of course. It’s a harder sell now.

If you go to a person who is not crypto savvy and you try to convince him to invest, especially in Brazil — the population has always been very skeptical of crypto. Now it’s harder,” he said. However, he notes that for people that use crypto as a means for cross-border payments or the “internationalization of money,” there will unlikely be any impact from the FTX collapse.

“A lot of the crypto volume in Brazil derives from players that are willing to exchange their local currency into an internationally liquid asset denominated in dollars. So in that sense, the market will not die down because crypto is just rails for that. ” In October, a report from Chainalysis found that remittance payments and battling inflation were two of the most significant drivers of crypto adoption in Latin America.

Related: Brazilian SEC seeks to change its role in cryptocurrency regulation César said the FTX collapse will likely be used by local exchanges “as a lobbying tool” to push for regulations aimed at bringing international exchanges in line. César added that these crypto exchanges had been pushing for regulation in Brazil that would “segregate” local and international exchanges by taking away international exchange’s access to their global liquidity books. “They were proposing that regulation would enforce for example, that liquidity on the books in Brazilian reais be segregated from international books.

” César explained that such regulation would hurt international exchanges as their main advantage comes from liquid, international global books. In a Nov. 18 report from Reuters, Roberto Dagnoni, the executive chairman and CEO of Mercado Bitcoin said crypto laws in Brazil have been “kind of dormant” during the election period but now needed priority.

“The rules that currently exist have not been applicable to some players, so they can do whatever you want,” he said. .


From: cointelegraph
URL: https://cointelegraph.com/news/ftx-collapse-won-t-impact-everyday-use-of-crypto-in-brazil-transfero-ceo

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