According to a report by crypto exchange Kucoin, over half of the Brazilian adult population believes in crypto taking over as a store of value and means of payment in the future.
Brazil, which is the sixth most populous country in the world has suffered an economic beatdown with inflation doubling in the past year to 10% annually. In addition, a large population of adults remains unbanked or underbanked contributing to a large part of the population transitioning to cryptocurrencies.
“Growing inflation in the country has forced 62% of Brazilian crypto investors to consider cryptocurrencies to be the “future of finance”, while 53% regard cryptocurrencies as a reliable way to store the value of their assets.” The report reads.
The report further revealed that 34.5 million Brazilians, which represent 26% of the population aged 18 to 60 have operated cryptocurrencies in the past six months. One out of six Brazilian crypto investors allocates more than 90% of their investment portfolio to cryptocurrencies with as high as 75% of investors exchanging their fiat for crypto every month.
Generally, 64% of crypto investors in Brazil stated that they were planning to increase their investments by 20%, disclosing they were considering investing in crypto.
A majority of crypto investors in the South American country expect to make high returns from crypto in the long term with others just looking to improve their living conditions. About 36% rely on crypto to supplement their other income sources.
That said, despite crypto adoption reaching a tipping point in Brazil, the report concluded that there was a need for investment education for most crypto users. 33% of those interviewed stated that they were uncertain about market signals while 27% do not understand how crypto works.
With the crypto market capitalization reaching $3 trillion in 2021 after Bitcoin tapped an all-time high of $68,000 in November making it the best performing asset in the last decade, cryptocurrencies witnessed a parabolic adoption rate, a trend that is set to continue especially with the Russia/Ukraine conflict. As per a report by Gemini, 41% of crypto owners globally made their first crypto purchase in 2021 with 54% of Brazilians saying they purchased their first crypto last year. Demand for crypto in this Latin American region has thus led to various crypto exchanges including Binance and Coinbase considering Brazil as a big prize in 2022 with Dubai-based Bybit announcing its entry Thursday, April 28.