USDT Accounts for 80% of All Crypto Transactions in Brazil in 2023

UTC by Darya Rudz · 3 min read
USDT Accounts for 80% of All Crypto Transactions in Brazil in 2023
Photo: Pexels

In 2023 so far, USDT transactions totaled $271 billion Brazilian reais (approximately $55 billion) and surpassed Bitcoin (BTC) transactions, which accounted for $151 billion reais ($30 billion).

Tether (USDT) stablecoin has become the most widely used cryptocurrency in Brazil, with its adoption incredibly soaring this year. According to the report from Brazil’s Receita Federal (the Special Department of Federal Revenue), USDT has made up as much as 80% of all the crypto transactions settled in 2023 so far.

As per the agency’s report, USDT transactions totaled $271 billion Brazilian reais (approximately $55 billion) and surpassed Bitcoin (BTC) transactions, which accounted for $151 billion reais ($30 billion).

The use of Tether in Brazil started gaining traction in 2021 when the nation’s inflation rate reached 10.06%, the highest level since 2015 and the fourth-highest after the implementation of the Brazilian real (BRL) back in 1994. The record inflation rate led to traders looking for ways to hedge against the steady depreciation of the Brazilian real against the US dollar. As a result, traders turned to stablecoins, with Tether being the most preferred one. Brazilians acquired $9.7 billion worth of USDT between January and November 2021.

By August 2022, nearly 80,000 USDT transactions totaling $1.42 billion were made by Brazilian companies, with an average amount of almost $18,000 per transaction. In October, almost $1.8 billion was transacted using USDT in as many as 119,366 operations.

In October 2022, Tether made USDT cryptocurrency available at over 24,000 ATMs across Brazil. The company also partnered with Brazilian payments company SmartPay, which helped integrate USDT with the Brazilian payment system PiX and TecBan, the largest ATM provider in Brazil.

At that time, Tether CTO Paolo Ardoino commented:

“The difficulties and limitations imposed by inflation and a less-than-inclusive financial system have excluded many of Brazil’s citizens from being able to participate in the country’s growing economy. Adding tether tokens to ATMs across Brazil provides the opportunity to include more people in the financial system.”

Next, Tether allowed users to deposit Brazilian reals at ATMs and receive USDT in their wallets.

While USDT dominates the Brazilian market, USD Coin (USDC) is the second most frequently traded stablecoin in the country, with USDC transactions totaling $23.9 billion transactions this year so far.

Another stablecoin widely adopted in Brazil is BRZ – the largest non-dollar stablecoin. Launched in 2019, BRZ is an ERC-20 token built up on top of the Ethereum blockchain designed to maintain a 1:1 peg to Brazilian real. It was the most traded Brazilian cryptocurrency in the country in January 2021, when the volume of operations with BRZ totaled approximately BRL 203 million.

Currently, Brazil is the fifth country in the world in terms of the number of cryptocurrency owners. Within the regulatory guidance introduced by the government in late 2022, companies operating in the crypto segment need a license to operate in the country, as is required for financial institutions. They must also obtain the legal entity registration number in Brazil (CNPJ). Another requirement is that suspicious activities must be reported to the Council for Control of Financial Activities (COAF).

Besides, all crypto exchanges operating in Brazil are required to disclose all user transactions to the government. Capital gains from crypto sales exceeding 35,000 reais per month are subject to a tax of 15% to 22.50%.

Blockchain News, Cryptocurrency News, News
Related Articles