Circle Expands To Brazil & Mexico, Will It Boost USDC Adoption?

Kelvin Munene Murithi
September 17, 2024
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Circle Boosts USDC Adoption With Hashnote Buy and Tokenized Fund Integration

Highlights

  • Circle integrated USDC with Brazil’s PIX and Mexico’s SPEI payment systems, reducing the need for international wire transfers.
  • Businesses in Brazil and Mexico accessed USDC directly using local currencies, saving on currency conversion costs and speeding up transfers.
  • The expansion of USDC aided cross-border trade and remittances in Latin America, improving cost-efficiency and settlement times.

Circle, the firm behind the USDC (USD Coin) stablecoin, has now entered Brazil and Mexico. Such a move is a major boost towards providing faster and cheaper digital dollar services to businesses in two of the largest Latin American economies.

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Insight Into Circle’s Latest Expansion

The company has integrated national real-time payment systems in both countries, PIX in Brazil and SPEI in Mexico. This move has made USDC accessible through local banks. Hence, it eliminates the need for costly and slow international wire transfers.

In addition, businesses in Brazil and Mexico can now purchase USDC from their local financial institutions using Brazilian Reais (BRL) or Mexican Pesos (MXN) without needing to first convert their money into USD. This new functionality provides several benefits:

  • First and foremost, it cuts down the time that is required to get USDC. All transfers will now take a few minutes and not days as it used to be.
  • Second, it assists the businesses in avoiding costs of converting one currency to another.
  • Third, it facilitates international transactions by utilizing a digital dollar that is easily recognized across countries

For companies conducting business in Latin America where many transactions are conducted in US dollars this is a significant development. Mexico is one of the biggest trading partners of the United States, where the trade turnover amounts to more than $800 billion for the year.

Likewise, Brazil also uses the dollar in a large measure of its foreign trade as the trade between the U.S. and Brazil stands at around $120 billion per year. As such, the possibility of using USDC for settlements facilitates and reduces the costs of all the businesses.

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Remittance Market

The expansion of USDC as a means of payment in Mexico is most suitable for the remittance market. By 2023, Mexico received more than $63 billion in remittances from the US alone, which was equivalent to 3.9 % of Mexico’s GDP. Stablecoins such as Circle’s USDC can be used for remittances and they are cheaper than the traditional methods. It normally levies a total of 63.5% in charges and as you can see, this one is much lower.

This move is in line with Circle’s vision of integrating blockchain finance with the traditional financial system. Jeremy Allaire, CEO at Circle, the firm that is behind the acquisition, sounded quite upbeat about the further growth. He observed that more local banks and payment systems across the globe will turn to blockchain technologies as the advantages of the internet -based settlements will be evident.

Meanwhile, this move follows the stablecoin issuer’s move to collaborate with Sony Block Solutions Labs in an effort to bring the bridged USDC to the Sony company’s newly launched Ethereum Layer 2 Soneium

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Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
Ad Disclosure: This site may feature sponsored content and affiliate links. All advertisements are clearly labeled, and ad partners have no influence over our editorial content.

Why Trust CoinGape

CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights Read more…to our readers. Our journal analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.

About Author
About Author
Kelvin Munene is a crypto and finance journalist with over 5 years of experience, offering in-depth market analysis and expert commentary . With a Bachelor's degree in Journalism and Actuarial Science from Mount Kenya University, Kelvin is known for his meticulous research and strong writing skills, particularly in cryptocurrency, blockchain, and financial markets. His work has been featured across top industry publications such as Coingape, Cryptobasic, MetaNews, Cryptotimes, Coinedition, TheCoinrepublic, Cryptotale, and Analytics Insight among others, where he consistently provides timely updates and insightful content. Kelvin’s focus lies in uncovering emerging trends in the crypto space, delivering factual and data-driven analyses that help readers make informed decisions. His expertise extends across market cycles, technological innovations, and regulatory shifts that shape the crypto landscape. Beyond his professional achievements, Kelvin has a passion for chess, traveling, and exploring new adventures.
Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
Ad Disclosure: This site may feature sponsored content and affiliate links. All advertisements are clearly labeled, and ad partners have no influence over our editorial content.