According to a report by the cryptocurrency exchange Kucoin, more than half of Brazil’s adult population believes that cryptocurrencies will take on the role of the digital transformation to finance.
Brazilian economic problems and interest in cryptocurrencies
Brazil, the world’s sixth most populous country, has suffered a financial beating, with inflation doubling to 10% a year in the last year. In addition, a large part of the adult population remains without access to banking services (or only to a limited extent), which further contributes to the large part of the population switching to cryptocurrencies.
The report states:
“Growing inflation in the country makes 62% of Brazilian investors in cryptocurrencies consider them the Future of finance, while 52% consider cryptocurrencies to be a reliable investment.”
The report also revealed that 34.5 million Brazilians, representing 26% of the population aged 18 to 60, had used the cryptocurrency in the past six months. One in six Brazilian investors allocates more than 90% of its investment portfolio to cryptocurrencies, with up to 75% of investors exchanging their Fiat for crypto each month. 64% of cryptocurrency investors in Brazil also said they planned to increase their investment in digital currencies by 20%.
Most cryptocurrency investors in this South American country expect to achieve high yields from cryptocurrencies in the long run, and the others “only want” to improve their living conditions. About 36% rely on crypto to supplement their other sources of revenue.
Although cryptocurrencies have reached a turning point in Brazil, the report concluded that most cryptocurrency users need investment education, with 33% of respondents saying they were unsure of market signals and 27% did not understand how the crypto works.
With cryptocurrency market capitalization reaching $ 3 trillion in 2021 after bitcoin reached a record high of $ 68,000 in November, making it the most powerful asset in decades, cryptocurrencies have seen a parabolic rate of acceptance. This trend will continue in particular in the conflict between Russia and Ukraine.
According to a Gemini report, 41% of cryptocurrency owners worldwide made their first cryptocurrency purchase in 2021, with 54% of Brazilians saying they bought their first cryptocurrency last year. The transformation to digital finance in Latin America is growing. The demand for cryptocurrencies in this Latin American region has led various crypto-exchanges, including Binance and Coinbase, to consider Brazil as one of the countries with the most significant potential this year.