The stablecoin Tether (USDT) has become increasingly popular in Brazil in recent years, representing nearly 80% of all cryptocurrency transactions in the country as of October 2023.
Tether (USDT) is a stablecoin, a type of cryptocurrency pegged to the US dollar. This means that each USDT token should be worth exactly $1. USDT is used by investors to avoid the volatility of other cryptocurrencies and also by businesses to make cross-border payments.
Transactions with USDT in Brazil reached R$ 271 billion ($55 billion) this year, surpassing the transaction volume of Bitcoin.
This is due to several factors, including:
• USDT is pegged to the US dollar, providing a hedge against the volatility of the Brazilian real. The Brazilian real has been depreciating against the US dollar for several years, and USDT offers Brazilians a way to protect their savings from inflation.
• USDT is widely accepted by cryptocurrency exchanges and Brazilian merchants. This makes it easier for Brazilians to buy, sell, and use USDT.
• USDT is a popular way for Brazilians to send and receive international payments. Transactions with USDT are fast, cheap, and easy to process, making them ideal for cross-border payments.
USDT is used in Brazil for a variety of purposes, including:
• As a store of value. Brazilians use USDT to protect their savings from inflation and shield themselves from the volatility of the Brazilian real.
• As a means of payment. Brazilians use USDT to buy and sell goods and services online and in stores.
• For international payments. Brazilians use USDT to send and receive international payments quickly, cheaply, and easily.
• The popularity of USDT in Brazil has led to increased scrutiny from the Brazilian government.
The Brazilian tax agency, Receita Federal, is now tracking citizens’ crypto-related activities using a sophisticated system that relies on artificial intelligence and network analysis. Additionally, Receita Federal is targeting crypto investments held by citizens abroad.
Source: Forbes