The bitcoin (BTC) and cryptocurrency exchange, Coinbase, enabled the option to send remittances in bitcoin and other cryptocurrencies to Mexico.
“We are introducing the ability for recipients in Mexico to withdraw their cryptocurrency holdings in their local currency,” the US-based company explained.
This means that a user located, for example, in the United States, will be able to send bitcoin and other cryptocurrencies to another resident in Mexico and the receiver will have the option of change them to mexican pesos if you wish or you can also keep the crypto assets in your digital wallet.
To make the exchange, the recipient of the cryptocurrencies will generate a redemption code from the Coinbase app, which will allow them to make the withdrawal in 37,000 points enabled in physical retail stores and convenience stores located throughout the Mexican territory. The more than 100 cryptocurrencies that are listed on the exchange can be sent, including the stable coin or stablecoin USD Coin (USDC).
The new service will be free until March 31, 2022. After that date, users will be charged a nominal fee that — according to Coinbase — will be “25% to 50% cheaper than traditional cross-border payment solutions.”
The exchange believes its option has “the lowest price to send and collect cryptocurrencies and the flexibility in how funds are stored will allow recipients to keep even more of their money,” it said in a statement. release.
Sending remittances to Latin America is powered by bitcoin
The sending of remittances between countries such as the United States and Mexico moves around USD 700 billion, according to the World Bank. In addition, the US dollar accounts of many Mexican residents are historically inaccessible, generate high fees, with complicated processes and long processing times.
The financial organization calculates that the commissions for sending USD 200 dollars average 6.8%. This percentage, which varies depending on the channel used, can take a lot of money from a person with limited income.
A Chainalysis report, reported by CriptoNoticias a few days ago, revealed that remittances from the United States to that region went from USD 100 million per month, between October 2019 and April 2020, to almost USD 400 million per month between April and May 2020. 2021.
On the other hand, in 2020, Mexico was at the head among the countries of the region with the most recipients of remittances in the world. At that time, it ranked third on the list behind China and India.
The massive adoption of bitcoin seems to be increasing the amount of remittances sent from the United States to Latin American countries, considering some of the advantages offered by blockchain platforms for cross-border payments, including low commissions.
As recounted in an article in this medium, there are varied testimonies of migrants who narrate how they have sent remittances with cryptocurrencies faster (in minutes) and cheaper, compared to traditional services.