Bitcoin volume traded in Brazil soars 73% in a year to US$12 billion

RIO DE JANEIRO, BRAZIL – The volume of Bitcoin (BTC) traded in Brazil rose significantly in 2021. From R$37.1 billion (US$7 billion) in 2020, transactions with the digital currency reached R$64.3 billion last year, a growth of 73.3%. The data are from the Federal Revenue Service.

The rise was driven mainly by the adhesion of companies. According to the IRS, the year ended with more than 459,000 companies declaring movements in BTC against less than 205,000 at the end of 2020. The number of individual investors grew 45%, from 4,647 to 6,775 in the same period.

The increase in demand was mainly due to the appreciation of Bitcoin, which reached new all-time highs last year. In November, the cryptocurrency hit a record high of US$69,000.

Despite this, the bulk of Bitcoin transaction volume took place during the year’s first half. From January to May, which had the highest volume, Brazilians traded over R$7 billion every month.

In July, the pace cooled off when the cryptocurrency finalized a correction of more than 50% and reached around US$28,000. The transactions regained strength in the second half of the year but did not exceed R$5 billion per month.

However, the price of Bitcoin was not the only catalyst for the skyrocketing volume of Bitcoin trades in Brazil.

“The Brazilian economic scenario helped too much,” says Ney Pimenta, CEO of crypto active brokerage BitPreço. For the specialist, the strong depreciation of the Brazilian real in 2020 and the loss of attractiveness of the stock market in 2021 pushed investors towards riskier assets, which promised higher profitability, such as Bitcoin.

The higher appetite for risk also benefited other cryptocurrencies. According to Brazil’s IRS, Brazilians traded R$7.7 billion in Chiliz (CHZ), R$7.1 billion in XRP (XRP), R$2.3 billion in Litecoin (LTC), and another R$1.6 billion in Cardano (ADA) and Dogecoin (DOGE).

Stablecoins, cryptocurrencies that have parity with another asset, usually the dollar, have also been in high demand and have outpaced Bitcoin volume over the past year. In 12 months, the Brazilian IRS recorded R$73.3 billion moved in various cryptos of this type, the majority (R$62.7 billion) in Tether (USDT).

In addition to serving as a gateway to trade other cryptocurrencies, the purchase of stablecoins offers simplified exposure to the U.S. currency and does not incur Financial Transactions Tax (IOF).