Bitpay has released figures showing a huge spike in transactions in Latin America, surging from 638 in February all the way up to 3,509 monthly in June 2015.
The world’s largest Bitcoin merchant payment processor included the data in an exclusive release of its monthly transaction records to the International Business Times this week.
Bitcoin is proving to be a stable protection towards inflation and lack of access to financial services in underbanked regions and where governments fail to address economic stability. This is likewise indicated by the spike of transactions in Latin American countries. Merchants in underbanked countries like Paraguay, Bolivia and Peru where debit card ownership percentage of population lies below 10% struggle to find payment solutions to use online.
Furthermore, high inflation and economic instability in countries like Argentina has been the key factor in the significant growth in transactions in wider region.
The majority of the Bitcoin community has been proposing that the Greeks implement Bitcoin to restructure their economy and use the currency instead of bank accounts and euros (which were frozen for quite some time due to capital controls), and thus expected Bitcoin to grow rapidly in Greece. However, Bitpay’s recent data suggests that Latin America is the next region where Bitcoin will flourish.
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According to the IB times, “Among Latin America's 600 million inhabitants, more than 60% are unbanked, meaning they have no access to bank accounts.” The Bitcoin trend in different countries in Latin America provides an additional suggestion that underbanked countries with lack of access to financial services, such as Argentina, lean towards Bitcoin.
Argentina, a country which has suffered military coups and comparatively frequent financial crises – over US$100 billion in international debt had been accrued in 2001 which plunged the nation into recession – has more than 150 local Bitcoin merchants and a few Bitcoin exchanges that are processing thousands of dollars every day. The Argentinian peso’s inflation rate lies at around 20%, and some Argentinians use Bitcoin to avoid the currency’s inflation.
"Living first-hand through the Argentinian economic turmoil following the 2001 default, we could only wish we had bitcoin as a solution to protect our income from inflation and devaluation," BitPay business development manager Pablo Magro commented.