Mercado Libre expands crypto offering in Brazil

Latin American e-commerce company Mercado Libre has launched a token in Brazil, aimed at generating crypto-cashback rewards on purchases, as well as the ability to pay for goods on the platform.

The Ethereum-based token, called MercadoCoin, can be traded via the company’s digital payment platform, Mercado Pago. The work is part of the loyalty program, designed to attract and retain customers.

Reuters first reported the news on Thursday, citing a news conference. Blockworks attempted to contact Mercado, but did not immediately receive a response.

Mercado’s crypto activities can be seen as a savvy play on the region’s high adoption rates for digital assets. Latin America has continued to capture between 8% and 10% of global cryptocurrency activity, according to Chainalysis’ research, reported in March.

Emerging markets face significant currency devaluation as a result of high inflation rates, prompting locals to buy crypto on P2P platforms in an attempt to preserve their savings.

Although cryptocurrencies have been affected by the recent market disruption spurred by survivalist lenders and a swing to bearish sentiment, the nascent asset class’s popularity in the region remains high.

The e-commerce giant began offering users access to bitcoin, ether and Paxos’ stablecoin PAX last December after it partnered with the crypto service provider. Mercado also bought a stake for an undisclosed sum in crypto exchange MercadoBitcoin.com.br’s parent company 2TM and Paxos as a shareholder in January.

MercadoCoin was expected to be valued at $0.10 before it was launched on the open market, Reuters reported. The crypto is available to 500,000 customers in Brazil, where it is expected to reach more than 80 million people by the end of the month.

The company also said that the token will only be available to Brazilian citizens, with no timeframe for expansion to other Latin American countries. Despite using the ERC-20 token standard, trading will be limited to the Mercado Pago platform for the time being, Reuters reported.

Get today’s best crypto news and insights delivered to your inbox every night. Subscribe to Blockworks’ free newsletter now.