5 investors discuss Latin America’s symbiotic relationship with crypto – TechCrunch

From Bitcoin’s valuation to data breaches on Axie Infinity and layoffs on major stock exchanges, crypto does not exactly have its best moment. But in many Latin American countries, where much of the population wants a better economic future, investors are still optimistic about the transformative power of crypto.

To understand how Latin American startups are preparing to cope with the crypto winter, we have talked to five investors (TechCrunch + subscription required) who have invested in companies that go a step further than traditional finance. They shared ideas about the market as a whole and also discussed how Latin America’s problems create tailwinds for crypto.

For example, volatility is less of a deterrent to crypto-adoption in countries such as Argentina, where legal tender is not exactly reliable. When its Minister of Economy resigned on Twitter on July 2, everyone knew that the local currency would plunge against the dollar. But on a Saturday, there was little they could do to avoid the sting. Web3 investor Matías Nisenson found a solution: “Thanks to crypto, I was able to short the peso over the weekend!”

Nisenson says the situation taught him how “crypto was able to protect some people from their politicians.”

This focus on solving real problems for the wider population is a common concern among entrepreneurs and investors in Latin America’s crypto and DeFi rooms. But for it to work, startups must first tackle UX challenges.

“We understand that we are still at the beginning of crypto as a platform for financial inclusion,” said Pato Jutard, co-founder of Newtopia VC. “Not only because the immature DeFi protocols still have to prove their robustness and security over a long period of time, but also because the overall user experience for cryptocurrencies, especially for escalation, is still too difficult to use and understand.”

Axie Infinity’s onboarding, for example, was not exactly easy. The need for a simpler user experience is one of the reasons why investors are still hopeful about play-to-earn and similar models.

“There are a number of options, such as training to earn (Stepn), learning to earn, etc. Many exciting opportunities for alternative sources of income while stimulating desired behavior,” said Christine Chang of Tribal, a fintech company that recently launched a venturearm, Tribal Ventures.

Another source of optimism, Chang said, is that “LatAm is actually ahead of the curve when it comes to women in crypto.” Argentina-based investor and author Claire Diaz-Ortiz agreed, noting that “there is something in the water when it comes to women in web3 down here.”

Read the full survey for an insight into how crypto investors in LatAm think about the sector, why they view El Salvador’s experiment with Bitcoin in a positive light and how they can best approach them for pitches.