Binance Survey: Latin American Citizens Call Crypto A Long-Term Investment Asset

Latin American citizens view cryptocurrencies as long-term investment assets. (Photo; Doc. Invesloan)

JAKARTA - The use of cryptocurrencies in Latin America shows a unique trend. Investors in this region tend to view crypto as a long-term investment and savings asset rather than just assets for daily trading. This was revealed by a recent survey from Binance, one of the largest crypto exchanges in the world, which digs up the preferences and motivations of users in the region.

The survey conducted by Binance involved 10,000 users from various markets in Latin America such as Argentina, Colombia, Brazil, and Mexico. The results show that 50.3% of respondents prefer to use crypto as an investment tool. This means one of the two users in the region see crypto as a way to save and invest in the long term. Meanwhile, only 18.8% of respondents claim to use crypto for daily trading.

In addition, the Binance survey also revealed several other uses of cryptocurrencies in Latin America. About 8.4% of respondents use cryptocurrencies for peer-to-peer (P2P) transactions, 8.2% use decentralized financial applications (DeFi), and 4.9% for purchasing goods and services. Interestingly, although cryptocurrencies in Latin America are often associated with remittance shipments and receipts, this use is only recorded at a marginal adoption rate of 3.4%, even under non-fungible tokens (NFT) which reached 4.8%.

The main reasons Latin American investors turn to crypto include the high potential yields they offer (20.3%) and the financial freedom they feel (15.2%). Other factors that drive them include protection against inflation and currency devaluation, innovation, portfolio diversification, and privacy.

Guilherme Nazar, Binance's regional vice president for Latin America, stated that the region is very important to Binance. "Latin America is a very important territory for Binance, and we believe there is room for significant user growth based on user specific requests in each country," he said.

Crypto markets in Latin America have grown significantly in recent years. In Argentina, for example, a sustainable economic crisis and high inflation have led many to look for safer investment alternatives than local currencies. This is driving crypto popularity as a way to protect their wealth from currency devaluation. In Brazil, meanwhile, the crypto market is growing rapidly with high adoption among young investors looking for portfolio diversification opportunities.

In addition, Colombia and Mexico have also shown increased interest in crypto. In Colombia, the use of cryptocurrencies for P2P transactions and remittances is increasingly popular due to its efficiency and lower cost than traditional methods. In Mexico, investors see crypto as a way to participate in financial technology innovation and take advantage of the profits offered by the global market.

However, despite the increasing many potentials and interests, challenges remain. The unclear regulations and high price fluctuations are factors that investors need to pay attention to. Governments in various Latin American countries are also considering how to manage crypto markets to protect investors while supporting innovation.

The price of Bitcoin, one of the most widely used crypto assets, is currently trading around US$66,500 (Rp1,064 billion) after testing the 70,000 dollar level (Rp1.12 billion). This price movement is affected by several factors, including measures taken by the US government against their BTC holdings on July 29. Regulational stress and action of big players in the market could affect the price of Bitcoin and, in turn, the overall crypto market.