RIO DE JANEIRO, BRAZIL – Uruguayan Santiago Panissa construction company started operations a year ago and launched a disruptive product in March. The company presented the possibility for investors and buyers to finance projects through digital currencies under the direct exchange with the company from the client’s wallet.
One of the primary target audiences is Argentine buyers or investors, said Santiago Panissa, owner of the company, in a conversation with Bloomberg Linea. The businessman justified the incorporation of cryptocurrencies as a means of payment. They seek “to be at the forefront” to offer their customers “an agile and convenient means of payment”. Besides, in the case of Argentines, he said, it allows them to overcome exchange difficulties.
“We are targeting the Argentine public because there is a lot of movement in the crypto issue; it is much more frequent in the Argentine market than in Uruguay,” Panissa said. “Considering that the volatility of the Argentine peso is playing against them, then many Argentines decide to hedge through crypto operations or simply to keep money in a stable and encrypted system,” he added.
For the case of Argentine citizens who come forward intending to build two houses, each will get a 25% discount, the company said in a statement. That offer applies to both cryptocurrency and dollar buyers.
The builder works with larger homes and projects and in different construction systems. One of the emphases they had so far was the recycling and expansion of constructions, especially in Montevideo, although they also worked on the assembly from scratch in the resorts of eastern Uruguay, Panissa said. The builder explained that “more land is being obtained” in that area.
FORM OF PAYMENT
The company will accept the different cryptocurrencies available in the market as a form of payment, although the reference value will be the quotation of that digital asset in dollars.
“Although the payment appears in dollars in the contract, we make the wallet-to-wallet transaction in USDT,” he said about the cryptocurrency that has parity value to the dollar. “The advantage of working with USDT is to avoid the client being dependent on the crypto he has at that moment. That allows us to work with all crypto and all tokens,” the builder explained.
Asked about the lack of regulation of the cryptocurrency market in Uruguay, Panissa stated that the company negotiates with the client under signature with a transaction between digital wallets, but the contract is registered for its equivalent in dollars. “While these types of transactions are just seeing the light of day in Uruguay, they are seen a bit more in Argentina. We believe they are here to stay, and we are adapting to that,” concluded Panissa.
UNREGULATED MARKET
The Central Bank of Uruguay (BCU) published on December 27, 2021, a document entitled Conceptual Framework for the Regulatory Treatment of Virtual Assets, with which it sought to make the first approach to the subject. Although the operations are allowed, they are currently unregulated, and the BCU warned about their potential risks.
The document did establish those types of operations through what they called “digital assets” that should be addressed in the future as aspects to be regulated.
Transactions with virtual assets referred to the securities market will be among the points to be regulated. As regards virtual assets used as a form of payment, the document stated that the BCU will have differentiated regulatory competence according to their type.
One of the points that will enter the regulatory framework will be those that the BCU called “stable virtual assets”, referring to the so-called stablecoins and those operations that give rise to a backing through fiat currency in local financial institutions.
“Value stabilization systems through backing in fiat currencies could derive in fractional schemes posing a high risk for users and the financial system’s stability in the absence of regulation. It follows from the above that this category should be included in the regulatory perimeter,” the document said.
But, in the next point, it pointed out that virtual exchange assets, including Bitcoin or Ethereum, are used as a method of exchange but are excluded for the time being from the eventual regulatory perimeter, as they are understood as barter or payment in kind. However, it will be subject to regulation in the case of investments using traditional financial instruments. In this case, the regulation would not be on the “virtual exchange asset” but on the financial instrument.
With information from Bloomberg Línea