One of Bitcoin’s greatest strength is its ability to thrive in restricted or emerging markets. Digital Currencies could reduce high remittances costs, create new markets and free up spaces for transactions to take place. South America is an example of one region that could benefit the most from the possibilities that Cryptocurrencies have to offer. In this article, we take a look at several major exchanges of the region and talk to Blinktrade’s CEO, Rodrigo Souza.

South America’s biggest Bitcoin markets are located in Brazil, in fact, the three major exchanges of the region -by daily volume- are from Brazil. Foxbit, MercadoBitcoin, and BitcoinToYou have a combined daily volume of 243 BTC, a minuscule number if you are used to the 8,000 BTC that is transacted every day on Bitfinex, but a significant one in comparison to other local markets.

Next in the ranking, we have SurBitcoin an exchange that operates exclusively in Venezuela. With a daily transaction volume of 50 BTC, SurBitcoin is one of the region’s key player. But a not so known fact is that Foxbit, SurBitcoin, and ChileBit share the same Bitcoin’s service provider, Blinktrade.

Blinktrade Exchange
Blinktrade’s Logo

Blinktrade provides Bitcoin technology for remittance companies, they are enabling instant, business to business transactions and payments using the blockchain, and they are bringing ATMs and mobile payments to their network, to connect more users with their client’s companies.

In an interview with The Merkle, Blinktrade’s CEO Rodrigo Souza talks about SurBitcoin’s inception, how challenging is to operate in a restricted market, and what are the future plans to expand Blinktrade’s platform and Bitcoin usage across the South American region.

Rodrigo Souza explains that in 2012 he create Blinktrade, a platform to provide a common frontend and backend that could be used by multiple exchanges, and to take care of the Bitcoin side of things. A company such as Foxbit hires Blinktrade to set up a Bitcoin exchange, they develop the website, run the servers and the company takes care of the FIAT operations, profits from the fees paid by traders and users of the exchange is then split 50/50 between the company and Blinktrade. In 2014, SurBitcoin is created and begins operations in Venezuela, Rodrigo tells us that the creation of the exchange was very easy, thanks to Blinktrade’s services, but that the operations of the exchange were somewhat slow and erratic because the FIAT deposits and withdrawals were fulfilled manually by employees of the exchange.

SurBitcoin started to amass customers thanks to several give-away promotions, buying beers to Venezuelans that were starting to realize the benefits of using Bitcoins to protect themselves from double-digit inflation -67% in 2014, and 220% in 2015-.

Operating an exchange in a country with capital controls is no easy, Rodrigo says that legally speaking, there is no law being broken in Venezuela, however, corruption of government officials in that country is the main enemy of Bitcoin adoption. All the other exchanges under Blinktrade’s platform in the region are functioning in optimum conditions. KYC/AML policies are different among the exchanges, in Surbitcoin for example, the exchange only makes sure that Venezuelans are the ones depositing FIAT, and that they are in fact the account holders, sometimes they perform security checks on suspicious accounts, and they request the owners to take a selfie with their ID.

We asked him if Blinktrade has intentions to include Ethereum into their operations, he says that right now they are focusing only on Bitcoin and that Ethereum will only be included in the short term if Bitcoin fails and Ethereum replaces it as the dominant Cryptocurrency.

Future expansion plans are: working on improving the platform, possibility of offering P2P transactions inside SurBitcoin exchange, so anonymous -yet verified- buyers/sellers can directly transact Bitcoins between each other, Rodrigo says that they have a good eye to prevent scammers from using their platform, so the security of the operations of this new feature will be the same as the traditional exchange.

Blinktrade is currently in the process to install Bitcoin ATMs in Brazil, Chile and Vietnam -another country with a Blinktrade’s exchange-. The ATMs are manufactured in China and will allow users to be more connected to Blinktrade’s client companies.

The landscape of Bitcoin in South America looks promising, on the political side of things, the region is experiencing a shift from left-wing governments that have put limitations and restrictions of currency in place -the case of Argentina and hopefully Venezuela-. to more open-minded officials that could allow more room to Fintech and Blockchain firms to thrive in. South America is one of the few places where Bitcoin is actually being used by necessity and the benefits of the technology are showing.

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