{"id":526926,"date":"2022-12-14T17:48:09","date_gmt":"2022-12-14T14:48:09","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/will-ftxs-ill-wind-reach-the-global-south-maybe-not\/"},"modified":"2022-12-14T17:48:09","modified_gmt":"2022-12-14T14:48:09","slug":"will-ftxs-ill-wind-reach-the-global-south-maybe-not","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/will-ftxs-ill-wind-reach-the-global-south-maybe-not\/","title":{"rendered":"# Will FTX\u2019s ill wind reach the Global South? Maybe not"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a36ed5c9130b\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a36ed5c9130b\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-1'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/will-ftxs-ill-wind-reach-the-global-south-maybe-not\/#%E2%80%9D_Will_FTXs_ill_wind_reach_the_Global_South_Maybe_not_%E2%80%9C\" >&#8221; Will FTX\u2019s ill wind reach the Global South? Maybe not   &#8220;<\/a><ul class='ez-toc-list-level-2' ><li class='ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/will-ftxs-ill-wind-reach-the-global-south-maybe-not\/#Speaking_from_a_%E2%80%98privileged_position\" >Speaking from a \u2018privileged position\u2019?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/will-ftxs-ill-wind-reach-the-global-south-maybe-not\/#Will_others_follow_Brazils_lead\" >Will others follow Brazil\u2019s lead?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/buradabiliyorum.com\/en\/will-ftxs-ill-wind-reach-the-global-south-maybe-not\/#%E2%80%98Crypto_is_very_resilient\" >\u2018Crypto is very resilient\u2019<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h1><span class=\"ez-toc-section\" id=\"%E2%80%9D_Will_FTXs_ill_wind_reach_the_Global_South_Maybe_not_%E2%80%9C\"><\/span>&#8221; Will FTX\u2019s ill wind reach the Global South? Maybe not   &#8220;<span class=\"ez-toc-section-end\"><\/span><\/h1>\n<p><img decoding=\"async\" src=\"https:\/\/images.cointelegraph.com\/images\/840_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjItMTIvZWY3OGNjM2EtMzUyNC00MTFlLWFkMmUtY2JlMDQ3MTI4NjYzLmpwZw==.jpg\" \/><\/p>\n<div class=\"post-content\" data-v-30a6cf80>With the crypto world still reeling from the FTX collapse, Brazil recently passed legislation that legalized cryptocurrency use for payments in the country. How to reconcile this with all those declarations in the West that crypto is having its \u201cLehman moment\u201d?\u00a0<\/p>\n<p>Brazil may have inadvertently revealed a cleft between the developed world and emerging markets with regard to the uses and misuses of cryptocurrencies. (The legislation still requires a presidential signature before it becomes law.)<\/p>\n<p>Unquestionably, FTX\u2019s Nov. 11 bankruptcy filing hurt crypto exchanges and other crypto-focused enterprises in Brazil, as well as many crypto-based companies all through Latin America (LATAM). But this latest gale in the crypto winter is <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/general\/\" data-internallinksmanager029f6b8e52c=\"3\" title=\"General\" target=\"_blank\" rel=\"noopener\">general<\/a>ly not seen as an existential threat \u2014 as it is sometimes portrayed in Western <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/social-mediaa\/\" data-internallinksmanager029f6b8e52c=\"1\" title=\"Social Media\" target=\"_blank\" rel=\"noopener\">media<\/a>. <\/p>\n<p>\u201cIt [FTX\u2019s implosion] was certainly a net negative everywhere,\u201d Omid Malekan, author and adjunct professor at Columbia Business School, told Cointelegraph. \u201cBut how much people are deterred is a function of whether they have access to stable currencies or reliable payment products.\u201d <\/p>\n<p>Many businesses in South America have felt pain from the crypto winter, David Tawil, president of ProChain Capital, told Cointelegraph. There&#8217;s been a slowdown in trading activity, layoffs and a decline in venture capital investments. Yet crypto practitioners in South America \u201care still plowing ahead,\u201d he said, because through much of the region, \u201ccrypto is functional, it has a real utility\u201d in ways that are not fully understood or recognized in the West. <\/p>\n<p>Stablecoins like Tether (USDT) and USD Coin (USDC) are much more important in countries like Argentina and Brazil where the government has implemented capital controls that limit the purchase of U.S. dollars. In Brazil, for instance, \u201cThere is only one currency \u2014 the local Brazilian real,\u201d Thiago C\u00e9sar, the CEO of fiat on-ramp provider Transfero Group, told Cointelegraph. \u201cYou can\u2019t have dollar accounts. You can\u2019t have euro accounts. So, in that context, a Brazilian stablecoin is very important for Brazilians.\u201d Stablecoins enable users to participate in international markets.<\/p>\n<p>\u201cUnlike the more developed economies, where crypto is seen as an investment,\u201d and the focus is obtaining profits from one\u2019s holdings, C\u00e9sar continued, \u201cin Brazil, that\u2019s actually not the case.\u201d Sales of stablecoins like USDT, USDC, and the Brazilian Digital Token (BRZ), a token backed by the Brazilian real, account for about 70% of the nation\u2019s crypto trading, he noted.<\/p>\n<p>Moreover, even as cryptocurrency exchange FTX failed, \u201cthe reach of that failure did not really affect retail users in Brazil,\u201d added C\u00e9sar. By contrast, \u201cif Binance had failed, then it would have been very problematic in Brazil \u2014 because a lot of people trade on Binance.\u201d<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Speaking_from_a_%E2%80%98privileged_position\"><\/span>Speaking from a \u2018privileged position\u2019?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Generally speaking, cryptocurrencies play a much larger role in LATAM and other parts of the Global South than they do in the U.S. and Global North, Tawil said. The U.S. and European viewpoint can be \u201cvery myopic\u201d at times. One has to live or work in places like Latin America to <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>reciate the difference. \u201cThere are people who never had a bank account, now trading. Argentina is mostly a cash society, and to see people dealing now in digital currency is quite amazing.\u201d<\/p>\n<p>\u201cPeople in the West definitely speak from a privileged position when it comes to crypto,\u201d Malekan said. He includes among the \u201cprivileged\u201d those like Warren Buffet who argue there is no need for cryptocurrencies because traditional banking products and services like credit cards work just fine. \u201cI guess it&#8217;s never occurred to these people that a substantial portion of the global population, many of whom live in the Global South, do not have access to such services,\u201d Malekan told Cointelegraph. <\/p>\n<p><strong><em>Recent:\u00a0Decentralized solutions for climate change are key as COP disappoints<\/em><\/strong><\/p>\n<p>Are the lessons being drawn from the FTX fiasco different in Brazil and the Global South, then, from those emanating farther north?<\/p>\n<p>Possibly, but it varies on a country-by-country basis, answered Malekan. \u201cPlaces that have capital controls are going to be more concerned about crypto services providers that are regulated and reliable because they can become a viable alternative financial system. In Western countries that have stable currencies and no capital controls the greater concern is fraud, money laundering and sanctions evasion.\u201d <\/p>\n<p>Still, some Western regulators appear to have had their worst fears confirmed with the FTX crash. A European Central Bank director general <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.ecb.europa.eu\/press\/blog\/date\/2022\/html\/ecb.blog221130~5301eecd19.en.html\">recently wrote<\/a>, for instance, that Bitcoin (BTC) had uttered its \u201clast gasp before the road to irrelevance.\u201d Earlier in the year (following Terra\u2019s meltdown) ECB president Christine Lagarde <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.cnbc.com\/2022\/11\/30\/european-central-bank-says-bitcoin-is-on-the-road-to-irrelevance.html\">declared<\/a> that cryptocurrencies are \u201cworth nothing.\u201d <\/p>\n<p>\u201cWe cannot downplay the fact that the world\u2019s second largest exchange in terms of traded\u00a0[crypto] volume ceased trading overnight,\u201d said Andrei Manuel, co-founder at Bit2Me, a Spanish cryptocurrency exchange. That said, \u201csome financial authorities and mass media are taking advantage of the opportunity to discredit and attack Bitcoin and the industry in general.\u201d As for Lagarde, she \u201cmay be nervous about the launch of their new model of digital money, the CBDCs [central bank digital currencies], and that this is an opportunity they cannot let slip away,\u201d Manuel told Cointelegraph.<\/p>\n<p>What Western critics sometimes fail to appreciate \u201cis that the collapse of FTX has not affected the normal functioning of Bitcoin or crypto assets,\u201d continued Manuel. \u201cThese have been affected in their price, due to a massive withdrawal of liquidity.\u201d But Bitcoin blocks continue to be mined and blocks are added to the ledger regularly, without interruption. \u201cBrazil will not be the first or the last jurisdiction to facilitate the use of Bitcoin,\u201d predicted Manuel.<\/p>\n<p>In any event, \u201cregulators should not shut down to new and innovative financial mechanisms, such as crypto,\u201d Fernando Furlan, partner at Furlan Associados Consultoria and former president of Brazil&#8217;s blockchain association, told Cointelegraph. \u201cBut to the contrary, they should create the conditions necessary for the safety of the investors.\u201d<\/p>\n<p>Others believe the lessons drawn from the FTX fiasco may not be so different whether one regulates from the Global North or Global South. \u201cIt is likely that regulators will establish more rigorous rules for crypto projects,\u201d Eloisa Cadenas, CEO of Mexico&#8217;s CryptoFintech, told Cointelegraph. Moreover, if the crypto industry is going to be maintained, \u201cit will have to be reinvented and restructured, and only those projects that have an interesting and relevant value proposition will be able to survive.\u201d<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Will_others_follow_Brazils_lead\"><\/span>Will others follow Brazil\u2019s lead?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>One shouldn\u2019t downplay the impact of FTX\u2019s demise in Latin America, either, said Cadenas. Numerous LATAM companies \u201care liquidating up to 30% of their human talent,\u201d and others are rethinking the use of business models, particularly in Mexico, El Salvador, Argentina and Brazil. Investment funds that leveraged FTX liquidity have gone bankrupt. \u201cThe blow has been worldwide. [\u2026] The collapse of FTX does not only affect the U.S. and Europe,\u201d Cadenas said.<\/p>\n<p>Still, it doesn\u2019t shock Cadenas that, amid all the current uncertainty, Brazil would pass crypto payment enabling legislation. \u201cIt is not surprising because Brazil is the country with the highest adoption of crypto assets.\u201d A recent government report found that more than 12,000 Brazilian companies <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/livecoins.com.br\/receita-recorde-declaracoes-criptomoedas-empresas\/\">reported<\/a> crypto assets in their financial statements, she noted, adding:<\/p>\n<blockquote><p>\u201cTherefore, it is something that sooner or later would happen, and we are going to see this more frequently in the laws of other countries; for example, El Salvador recently launched a proposed law to regulate digital assets.\u201d<\/p><\/blockquote>\n<p>El Salvador already has its well-known Bitcoin Law, of course, \u201cbut that does not apply to other crypto assets,\u201d Cadenas added. <\/p>\n<p>Will others follow Brazil\u2019s lead? \u201cIt\u2019s quite likely,\u201d said C\u00e9sar. \u201cBrazil has solidified itself as a regional leader. So it is a benchmark, not only in crypto regulation, but also in the banking system in the region.\u201d Here he was referencing Brazil\u2019s popular Pix instant payment system, implemented in 2020, that has made local bank transfers \u201cinstant, free and available 24\/7,\u201d adding:<\/p>\n<blockquote><p>\u201cBrazil is trying to project its influence across the region \u2014 not only exporting crypto regulations but also exporting its Pix system as well. Other countries such as Colombia are already reported to be interested in adopting a Pix-like local bank transfer system.\u201d<\/p><\/blockquote>\n<p>If the new Brazilian legislation is signed into law, as expected, some sort of government-issued license will probably be required to conduct crypto-related activities, said C\u00e9sar. The central bank will determine many specific requirements, such as minimal capital needed to buy and sell crypto, minimum experience of directors, etc. The legislation as written lacks many key details.<\/p>\n<p>Not all may be guided by Brazil\u2019s example, however. On Dec. 5, Paraguayan lawmakers\u2019 efforts to make Bitcoin mining a recognized industrial activity faltered as Paraguay&#8217;s lower house failed to override a presidential veto of the initiative. The original bill was passed in July. Legislators might have been rethinking crypto matters in light of FTX. <\/p>\n<h2><span class=\"ez-toc-section\" id=\"%E2%80%98Crypto_is_very_resilient\"><\/span>\u2018Crypto is very resilient\u2019<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>All in all, cryptocurrencies, and especially stablecoins, are going to be a \u201c<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/game\/\" data-internallinksmanager029f6b8e52c=\"7\" title=\"Game\" target=\"_blank\" rel=\"noopener\">game<\/a> changer\u201d for many people in the Global South, especially in countries like Argentina that make it very hard for people to buy dollars, said Tawil. \u201cIn the U.S, there aren&#8217;t really hurdles to opening a bank account.\u201d In the developing world, including much of Latin America and Africa, one\u2019s financial options are often quite restricted. <\/p>\n<p><strong><em>Recent:\u00a0Crypto hotspots continue to thrive despite FTX collapse<\/em><\/strong><\/p>\n<p>Cryptocurrencies\u2019 uses can be myriad. In Argentina, crypto can be used as a mechanism to fight inflation, a way for people to access dollars, or just a means to internationalize their wealth, said Tawil. In Brazil, it can be an instrument to internationalize wealth \u2014 even if Brazil doesn\u2019t have the same inflation problems as Argentina. \u201cBut it\u2019s basically access to freedom,\u201d Tawil added. <\/p>\n<p>FTX may still set back the crypto industry for years globally, in C\u00e9sar\u2019s view. But \u201ccrypto is very resilient, especially when you see where it solves real problems.\u201d <\/p>\n<p><template data-name=\"subscription_form\" data-type=\"law_decoded\"><\/template><\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/will-ftx-s-ill-wind-reach-the-global-south-maybe-not\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8221; Will FTX\u2019s ill wind reach the Global South? Maybe not &#8220; With the crypto world still reeling from the FTX collapse, Brazil recently passed legislation that legalized cryptocurrency use for payments in the country. How to reconcile this with all those declarations in the West that crypto is having its \u201cLehman moment\u201d?\u00a0 Brazil may&#8230;<\/p>\n","protected":false},"author":1,"featured_media":526927,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/images.cointelegraph.com\/cdn-cgi\/image\/format=auto,onerror=redirect,quality=90,width=1200\/https:\/\/s3.cointelegraph.com\/uploads\/2022-12\/ef78cc3a-3524-411e-ad2e-cbe047128663.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[74860,75917,135234,89897,74355,117,55229,67874],"class_list":["post-526926","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-cryptocurrency-exchange","tag-exchanges","tag-ftx","tag-sam-bankman-fried","tag-adoption","tag-business","tag-law","tag-united-states"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/526926","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=526926"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/526926\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/526927"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=526926"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=526926"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=526926"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}