Cryptocurrency companies vying for share of Mexico’s remittance market

According to the World Bank, Mexico ranked second in terms of remittances – the figure exceeded $ 5 billion. Almost 20% growth in market activity attracted companies from the cryptocurrency industry to the country.

In the last year alone, about half a dozen cryptocurrency giants, including Coinbase, Bitso, Africhange and Everest, have started providing digital asset transfer services in Mexico. Structure.fi President and Co-Founder Bryan Hernandez said:

“Cryptocurrency companies see huge opportunities here to streamline conventional money transfer processes using blockchain. Using cryptography, it is possible to make instant cross-border payments with little or no fees.”

So, in February, Coinbase launched a service for US customers who want to send cryptocurrency transfers to Mexico. Recipients of cryptoassets can withdraw money in pesos. Tether, which is also vying for share of the Mexican market, launched the peso-pegged stablecoin MXNT in May. According to the USDT issuer, this will help clients use cryptocurrencies as a store of value.

One of the biggest factors driving the Mexican cryptocurrency remittance sector is the huge number of citizens of the country who are abroad. Almost 40 million Mexican immigrants live in the US alone. Remittances sent to Mexico from the US accounted for about 94.9% of the total.

Another reason why more and more Mexicans are turning to cryptocurrency transfers is a distrust of banks. More than 50% of Mexicans do not have bank accounts. This makes cryptocurrency money transfer solutions convenient for citizens of this demographic, as all that is needed to receive funds is a cryptocurrency wallet address.

Recall that at the beginning of the year, the president of the Association of Mexican Banks (ABM), Daniel Becker, met with the governor of the Bank of Mexico, Victoria Rodríguez Ceja, to discuss joint work on the introduction of the state digital currency.