Brazil is becoming a hotbed for crypto adoption, with the country’s tax authority recently claiming that over 12,000 companies hold digital assets.
Digital asset custody platform GK8 has partnered with 2ND Market, a Brazilian crypto holding company, to expand cryptocurrency product offerings in Brazil — a move both companies say would support continued adoption in Latin America’s largest economy.Â
Under the partnership agreement, GK8 will license its institutional-grade custody platform to 2ND Market to give Brazilian users access to a wider range of crypto products and services. In particular, 2ND Market will leverage GK8’s integration with MetaMask Institutional, a multi-custodial wallet, to provide users with access to decentralized finance (DeFi) and Web3 crypto assets.
Founded in 2018, GK8 reportedly manages roughly $50 billion of digital assets — up from $1 billion two years ago — and utilizes an air-gapped Cold Vault to eliminate cyber attacks. The company has established custody partnerships with crypto trading platform INX, the Stellar blockchain network and the State Street-backed Securrency, among others.
2ND Market operates as a technology ecosystem that is trying to bridge infrastructure and crypto usability. The holding company operates multiple entities that work together to support crypto integration and adoption in Brazil.
Related: The blue fox: DeFi’s rise and the birth of Metamask Institutional
GK8 referenced a study by crypto exchange KuCoin showing an upsurge in Brazilian crypto adoption as a key reason for establishing the partnership. According to the KuCoin report, roughly 16% of Brazilians — over 34.5 million people — have exposure to digital assets like Bitcoin (BTC) and Ether (ETH). A separate report from the Gemini crypto exchange in April also concluded that Brazil was leading the world in terms of digital asset adoption.
Brazil is going deeper into CBDC with a new test from Mercado Bitcoin. https://t.co/F5FYMo9iLa
— Cointelegraph (@Cointelegraph) May 25, 2022
Crypto adoption in Brazil is growing on multiple fronts. Brazil’s tax authority recently reported that, as of August, over 12,000 companies had digital assets on their books. Meanwhile, the city of Rio de Janeiro just announced that it would begin accepting crypto for property tax payments.
When asked about the state of crypto in Brazil, GK8’s co-founder and CEO Lior Lamesh told Cointelegraph that soaring inflation and a collapsing local currency have both served as adoption drivers:
“With inflation at 10% and a weakening Brazilian real, it is no wonder why crypto adoption in Brazil stands at approximately 16%. In fact, Brazil is at #7 in the Chainalysis crypto adoption index, the highest-ranked country in South America, and not far behind the USA. We believe that macroeconomic winds will continue to drive adoption higher.”
