Latin American e-commerce giant Mercado Libre is launching its cryptocurrency in the Brazilian market.
The Buenos Aires-based company announced at a press conference Thursday the launch of its MercadoCoin digital currency, which will be part of a new loyalty program. This was reported by the Reuters news agency and other media.
According to reports, the cryptocurrency will initially be launched in Brazil and will allow customers to receive refunds for purchases made through the e-commerce platform. Mercado Libre users will then be able to use the token for new purchases and exchange it with the company’s financial services unit, MercadoPago.
According to Reuters, the digital currency will be available to 500,000 customers in Brazil starting Thursday. Mercado Libre expects its 80 million users in the country to have access to MercadoCoin by the end of August.
The company added that it plans to launch it in other countries in the region “soon,” although it did not provide details, according to the CoinDesk report.
MercadoCoin is an ERC-20 token based on the Ethereum network that can be traded through the MercadoPago app at a starting price of US$0.10. During the initial phase, users will not be able to transfer it to external wallets, CoinDesk adds.
The news outlet quoted Guilherme Cohn, senior manager of corporate development at Mercado Libre, as expressing his excitement and the company’s vision for the development.
“The blockchain technology behind MercadoCoin has allowed us to develop an open and extremely secure solution. We continue to follow the development of cryptocurrencies and blockchain technology, as we believe in the potential of these tools.”
MERCADO LIBRE FOCUSES ON BRAZIL
Although Mercado Libre has its roots in Argentina, the company has strongly developed and expanded its financial services offering in Brazil. Last December, the company launched a cryptocurrency trading service in the country, which surpassed the one million user mark just two months later.
Brazilian Mercado Pago users can buy, sell and hold bitcoin, ether and the U.S. dollar-pegged stablecoin USDP directly through the app. After a successful launch last year, the company recently said it is ready to expand the crypto trading service to other countries in Latin America.
While there is no clear timeline for the expansion yet, the effort and today’s launch underscore Mercado Libre’s focus on the digital asset sector.
This suggests that the company’s proprietary cryptocurrency could soon be integrated into its cryptocurrency exchange service, allowing users in the region to exchange MercadoCoin for assets such as BTC.
MercadoCoin is currently only available through the Mercado Pago app and has not yet been listed on any cryptocurrency exchanges. There have also been no known efforts to list the token on other platforms.
Meanwhile, competition for cryptocurrency services in Brazil is heating up. Within a few months, several financial institutions in the South American country, including Santander and Itaú banks, have launched or announced plans to launch their own crypto products.