Scaling Real-World Adoption of Stablecoins in Argentina and LATAM - Panel

Hi everyone, I'm Dodo Das, the head of crypto of the Argentine Fintech Chamber and Exentral Bank for for 10 years. So, welcome to the first panel of our event and first I want to say thanks to Parvina and the organization uh for give us the opportunity to show how important is Argentina in cryp adoption. Well, let's start with a quick presentation of yourselves. So, Sea, if you want to start.

Y thank you Diego. Thank you for the invitation. Uh I'm Resano. I'm based here in Argentina. I've been in crypto for almost 10 years now.

Uh working for for different projects and protocols. I see Sel here as a sponsor very close to dear to my heart. Um and I've been uh you know working for for with with stable coins uh in Argentina together with with the fellows here for such a long time. I was hearing Julian here talking about the uh the importance for uh for the economies for helping the families to to progress. So uh it's a topic that I've been studying a lot and and collaborating with universities Cambridge alternative uh finance center.

So uh very excited to to enjoy this conversation with with our friends here. Uh thank you for the invitation.

Hello Diego. Hello Se. Hello Manu. Hello Maxi and thank you all for coming today, taking the time. My name is Luca.

I'm the CEO, co-founder of Bur. Bur is essentially a platform where we are tokenizing equities and real world assets and allowing people to buy them with the stable coins.

Thanks Zo for the invite and everyone at stable summit for making this happen. Uh this is Manoro Sio coounder of Bello. Basically, we are a kind of a crypto new bank, you know, for a digital age. Uh, yeah, really happy to be here. Hi, everyone.

I'm Maxi Rondi, Lemon CFO. I've been around Lemon for the last four years. Lemon is a dual wallet with major presence here in Argentina and we are right now expanding into Latin America, first country Peru, now moving into Colombia and coming soon Brazil. Well, let's start with Sebastian. Um, what are you seeing in markets like Argentina and in the region?

And is the interest real or it's just a wave we have now in Argentina, but focus in Argentina.

I think stable coins in Argentina have been uh probably Argentina was the the the leading case or one of the key markets in the adoption. I recall back in uh 2018 2019 u 2020 you know lemon was starting to uh to appear in in the Patagonia no trying to build um the marcado for crypto manu was uh tweeting on I imagine you know interoperability uh between digital payment systems uh and that was about I think the time the D adoption really u spiked in Argentina as a as a way to access dollars as a as a store of value. Um so I think for the last at least seven years we have been a a growing market and you will see now today with the fintex no the use cases are very much connected to to the stable coins. So typically fintex and and and crypto exchanges and wallets I think they have five use cases uh at the core and then of course they differentiate a lot but what we are seeing is essentially no on ramps off ramps as a as a trading of crypto so buying stable coins with with pesos or dollars I think that's a bit of the the main case or the first case second is uh QR payments so how connect to uh your digital wallet your SE coins to to do this kind of uh interoperability that Manu was mentioning. I'm I'm sure you're going to dive deeper into that.

Uh I think also this uh this concept of having a a a dollar wallet no a digital account uh that's across the board that that is provided by by FinTx and and the exchanges and then you know more additional cases for crossber payments for gig workers for for for businesses and of course you know connecting all these balances uh to cards so you can spend at many merchants. Um so we we see a great adoption in Argentina on a day-to-day and and even in the region uh it keeps scaling every every day more uh not just on on the again dollarization or buying st coins to to um to protect yourself from from inflation and protect your purchase power but also to to enhance new uh new functionalities and use cases. So you said QR codes and adoption in the same sentence and there are a lot of people from outside not from Argentina and they really need to know that in Argentina we use QR codes every day for paying with crypto for grab a coffee for everything. We are very used to to use the QR code. So you talk a lot with companies about FinTech and we can assume that the interest is real and they need new products uh with crypto, right?

Yes. And and uh especially I I'm you know entrepreneurs like like these three fellows here are amazing. They they create very innovative solutions. Uh I'm very excited to see how stable coins are used for fiat payments for for cross border. So connecting you know picss for Argentina traveling to to Brazil or or or here.

So I think this being as a part of the key infrastructure underlying the the new innovations in in payments and and beyond payments as well. Well, Maxi, according [clears throat] with the last report of Lemon, Argentina is leading the crypto adoption in the region. Um, one thing that I really want to ask you is, do you think that this is just another hypo or uh we are starting something different in Argentina this time? Uh [clears throat] well mainly if if if you look back I mean at the very beginning the crypto adoption stable coins was mainly driven by retail then the institutionals uh big companies buying stable coins or buying crypto crypto assets. So when when you came to Argentina you see at the like 2023 was a huge year for the stable coins.

I mean the elections and as Julian mentioned in the introduction and maybe also you the the the devaluation the the the inflation rate three digit inflation rate. So was really tough for the Argentine to keep the payroll or their salary the paycheck at the end of at the end of the months. [snorts] So people really um start seeing and buying a stable coins as store of value. So that happened in 2023 2024 with more stability with lower levels of inflation and the valuation then people move a little bit at least in lemon no move into into Bitcoin being Bitcoin one of the demanded assets and right now we see that stable coins is already on on on a stage. Um we see stable coins as the infrastructure.

For example, we have products in lemon such as as well and bellow did it awesome with the pigs product. Lemon we also have picss product. Uh so people is using a stable coins behind the scene without knowing that but they are using on on daily basis. For example, when when paying with our prepaid card, they are paying using a stable coins behind. When they are doing crossber transfer, they are also using a stable coins.

Or even when we open Lemon in Neon, users can open a a dollar base or an eer based account and automatically converting into stable coins and then they pay the with a credit with a prepaid card here in Argentina. and all of that behind the scene we are using uh stable coins infrastructures. So uh we we see more and more the infrastructure getting in between the fintech companies such as BO such as Lemon and other colleagues that we have in the industry along with the traditional banks. So we see that happening. Well last year we saw the all-time high of Bitcoin.

So that's natural that people demands more and more Satoshi's, right? Um, but in Argentina, people are still demanding stable coins and I don't know that this is normal because uh all of the Argentinian people thinks in terms of dollar. Um what do you think that demand is still strong even when the government uh retired the the provision of access and limitless dollars in Argentina?

Well when that for example when that happened uh when the government they we released the restriction in order to access to the dollar was one of the day that lemon sold more more stable coins than ever. It was like an old time just after the restriction was gone. So I think that dual wallets like ours people can access to that immediately uh frictionless and you use that on your daily base on on daily basis. So uh I see more and more people at least in Argentina although we do not have those level of inflation but as you mentioned the argent they we the Argentines we think in terms of dollars. So stable coins are going uh are the ones that are um putting away the dollars the the the fiat money and getting in into our economy for sure.

And what's missing for people to actually start using stable coins, payments, investments? Well, I don't know. Oh, probably there's nothing missing.

No, I think that um maybe I don't know what Manu thinks about that, but we have a lot of presence.

Manu goes after you. So,

okay. Now,

spoiler the his answer.

We we discuss it kind of in the industry. We discuss it kind of these kind of things a lot. So I think that more education more uh we have a lot of presence in in in the market maybe we can do a little better. Uh but I think that people is adopting uh day after day. I mean uh maybe institutionally the some banks adopting but banks are adopting maybe more uh we we heard about the banks maybe um someone in the past asked what what do we think about banks adopting crypto and we are good with that.

I mean that's perfect. I mean we do not see any kind of of of problem in terms of bank adopting crypto. We see more people h having the access to crypto and players that we are going to be sharing the market share and we going to be uh introducing more crypto into Argentina. So yeah, I I would argue that the problem is that banks not accepting crypto. It's a problem because it's like you know trying to block the sun with the hand you know uh these things are waves of innovation that you cannot change you cannot stop.

So uh if you think that you will still be having a profitable business out of uh sending paper mails. I mean you should rethink how you think about the world you know. Uh going back to the question around payments and and merchants I think that's kind of the chicken egg problem. Um when I go to my bachelor and say hey you need to do start accepting stable coins say who is going to pay in stable coins and I want to sp paying stable coins and he doesn't accept it. So maybe [snorts and clears throat] it's a wrong approach uh in the sense that we shouldn't be pushing for that and more in terms of how this becomes a TCP IP type of technology that is totally transparent to the user that you use it on daily days on daily basis and and adds you a lot of value.

Going back to the question around um why people get to uh stable coins. I think there's a few answers there. Um and maybe there's and this hypothesis we are mostly servicing a new type of user segment of users which are native digital and they think in terms of digital money uh where the boundaries of a country are basically erased. Um so for them just holding a local currency and it could be anyone uh which is the less accepted worldwide uh it's a blocker for a correct development of their economic activities. That doesn't mean that you won't be able to start issuing a local stable coin.

Uh I think that it's still an experiment that needs to be done and tested and see how it goes. Um but yeah uh I think there's also a lot in ter a lot of innovation in terms of payment. You know Argentina has kind of the blessing of having a central bank that had been doing a terrific job around payment infrastructure.

Uh uh and not because you are here or they are there.

No. I I I say this a lot, you know, uh and also very very critical about other stuff, you know, but I think the the fact that you can send money with an alias that you can pay with QR codes, just to give you an an idea, bellow supports like 12 different nationalities, those 12 different countries that they can on board, they can deposit tet, come to Argentina and pay with QR code. Automatically you have increased your time by 10x because by connecting two pieces of technology that were totally apart suddenly you create new markets and I think we need to start thinking in that terms not in the extractive terms saying what I get for me it's more on how we create more value for all in the table you know

and can we talk about how Argentinians are paying in Brazil using bellow with pigs, you use sevil in the back. So if you can explain that.

Yeah. Uh and I don't know why the t-shirt is was not planned t-shirt

but yeah. Yeah. We we just open operations in Brazil. So I'm trying to be more Brazilian. Um [snorts] so basically what we found at the time was uh we started tinkering with pigs back in 2020 uh 2023.

Um initially with there there was a massive wave of Brazilian tourists coming to to Argentina because obviously of the economic situation. uh we start doing an effort on how we allow or help local merchants accept payments from Brazilians by providing a PX uh QR code and doing the settlement on chain through uh the over polygon. Um and that experiment start to catch up. But we found out uh that on boarding merchants it's super hard, super hard because uh you need to do one by one. You need to go and talk with the owner and you need to create a product that is tailored to the need of that merchant.

Um so it's not easy. uh other companies [clears throat] big you know players in the fintech space have you know invested more than $80 million doing that it's not the the amount of money that we have in our balance uh so we start seeing kind of the macro and we saw that at some point the rail was turning around and we see that I mean there's always a natural relationship between Argentina and Brazil okay how we t tackle that and basically what we did was allow the opposites you know with sauce, stable coins, etc. be able to connect with the P the Pix network and it worked like magic, you know, the adoption was, you know, uh binary in a way.

Yeah. And you talk a lot about the the adoption of your users. And let me make one question for you Maxi and and Manu. How do you build trust in your users? Because at the end of the day we need people who are trusting in in

Can you repeat what

trust? How do you trust your your

how they trust us?

Yeah.

No, there is a saying that trust is something that it compounds over time but it can be destroyed one second. So I think it's like there's a mantra don't it up, you know. Uh and I think that's that's true all the time. So being um trying to be as transparent to the user as possible because the user is not as stupid. Uh trying to build something that you know they they need uh they want listen to them.

Uh and at the end of the day you know generate that confidence. uh Argentina has the particularity that we are uh we are you know an empire which has been pretty much impacted by the 2001 financial crisis and I think that scar is still you know present in every day. So even if you know whatever happens a provider the app cloudflare either you know the the the the cloud falls automatically the message from the user is there's a coralito and that is not true you know

there are a lot of people who don't know

coral for the coral

coral for the ones that are not Argentinians it's basically during 2001 crisis the banks took the savings from the from the people um and well they disappear in just to make it simple. So that scar is really present. So there's a lot of pressure from the the the the public into also kind of the SLA that you are giving as as a service provider you know

and Maxi what's your thoughts about that

pretty similar to one that Manu mentioned and 2001 was a clear example of what happened in Argentina and and the reason why the Argentinians maybe do not entirely believe in in in in banks or institutions s and [clears throat] uh for example in in our case um maybe you did you do not know remember or you do not know about 2001 Argentina but I'm sure that you know about the FTX the FTX crash I mean and that was a moment where all our users start taking out the their money and the savings from from from the lemon accounts and we saw at that time the uh the asset under custody that Lemon has decreasing and decreasing decreasing and at the end of the day the asset of the custody under custody is the money that the our users move and generates our revenue and generates our uh commission and fee and etc. So when we saw that happening uh at some point we were thinking about what's going to happen I mean if everyone uh move away the their savings from our from our from our accounts from lemon I mean we are in a in a deep So at that time we decided that if anyone need to take take it out but we were that is what Manu mentioned about trust. I mean people freedom people need if they need to take out the money just take it out and we hold there people and at some point no one else keep taking out the sorry the money from their accounts. So we have been conf we have been confident at at that time people trust in lemon then we create our proof of reserve and the proof of liability and that transparency uh is it's I mean was like magic people the users or anyone can see our reserves or the the user reserves onchain online and is it is updated every 10 minutes so everyone can see the amount the the the the the addresses the wallet that we have and the money city there. So I totally agree with mano transparency and trust and giving the people what they need.

Yeah. And I think maybe this more of a feature or uh by design of of crypto overall is that if you are a liquid company uh and you don't have your say assets or the assets of the user compromise being responsive and being able to hey this here's your money and you can take it in one minute and then put it back. I think that reaction and seeing that it works provides a lot of you know confidence in the user and say okay I trust these people because if you cannot you know uh if you go right now into a bank and say I want to withdraw 100 million pesos it won't be easy to do that I'm sure that it will fail uh for sure so I think the the good thing is that the design of how we work is kind of tailored for those situations you know in a way

um well goes with you, Luka. Luka is the youngest in this panel. And the one

I'm so envious, you know,

I'm so envious of of in he's the youngest. Um, you're building a product focus on on on the client and and the client needs and people who are young as you. Um, how do you see stable coins helping regular people or traditional investors? So at Bur we like to say or our vision is that stable coins are not a product but as Maxi stated is an infra it's a enable it's it's unlocking a new financial system for people that has been outside the the financial system of of people like similar to people in first world country residents for example. So I think like stable coins are unlocking ways of investing in equities, investing in TV bills, uh investing in anything, accessing credit.

So accessing different type of products that are better than the products that are available in the traditional way for example and I'm a product guy. So I think that basically building a a better product with the stable coins, allowing people to access their money 24/7, allowing people to take credit on that, allowing people to move money faster and cheaper will will be the the the thing that will unlock the next billion users.

Can you explain what are you doing at the bur? So what Bry did?

So what what we are doing basically is what stable coins did for dollars, we are trying to do that for any financial asset. We started with tokenized equities. We are working with broker in the US and we are tokenizing spy, NASDAQ, Tesla, any stock in the in the US market. We also have break markets for example because well our vision is that every financial assets need to be tokenized and accessible and we think that the democratization of finance is that to to let the user choose whatever they want and put it there and and let the user as well as Manu and Maxi and and say sorry to allow people to to move their money whatever they want. and what's still blocking the access uh to the whole stable coin uh market.

So I think we are I mean I mean I think we are shifting to a more kind of a offiscated model right now and we didn't we stopped talking about USDC US and now we are talking more about digital dollars. I think that crypto because of the Bitcoin cycles and and FTX and and and all the black swans has a bad reputation for people that don't don't is not inside crypto at all. So I think if we take for example what credit cards or or debit cards I mean when someone pays with a debit card they don't know what is happening in the back and it's a lot happening in the back. It's the same with you manu that people doesn't know that they use a stones to pay.

The the problem is that we keep on explaining and we shouldn't be explaining. I mean we should focus on the product.

Yeah. And we stop talking about crypto and instead we need to talk about blockchain.

No, not even that. I think we need to talk about the problems.

Yeah.

You know it's on product problems solutions add value to the user.

Yeah. And I think we have an advantage in crypto is like our product is better and we need to focus on that. We need to focus on on on for example giving people a a way of accepting payments in a cheaper way than access like without commissions for example or or or to receive the money in on the same time on the same day. So yeah, I think if we are if we continue building products on top of stable coins, on top of tokenized assets uh that are as I say like almost three four times right now better, faster and cheaper, people are going to like they're going to choose that because it's better for them.

Okay. Well, we are running out of time, so we need uh time for one question and I really want to to ask for you. Uh what do you expect the next year in Argentina and in crypto landscape starting from you?

Uh I'm very excited what we are building Luka in in Bur I think the connection between uh no investment accounts uh and payments is is very interesting. No, I think given by by by the inflation uh of course we have suffered inflation in LATAM for always I can't remember but now with inflation in the US in Canada I think this this topic is you know broadening and and new solutions and product are being made so people can you know take their balances from their savings checking account in the bank and just move it to a fintech to crypto to generate yield to protect you know your uh your purchase increasing power and connected to all the amazing knowi solutions to generate yield uh to do transfers and to really uh take ownership and responsibility on your um on your investments. Uh and I think you know the real world assets is a is a great I think next theme for for the next couple of years. I don't know if next year, but we're already starting to see uh the traditional know exchanges like uh Beimma in Argentina or P3 in Brazil starting to to tokenize security. So I think that's very interesting uh as an additional no aic case to to the stable bitcoin.

So you access to this digital uh asset infrastructure by on ramping with stable coins and there the sky's is the limit. you you can you know access markets worldwide and and different asset classes. So I think that's uh what I'm more excited about this space. Well, thank you. Thank you for for your words.

S well I think what I what I think about Argentina is that in the last two decades we have been kind of like preparing for for this moment. I mean uh I am I I like to call myself not a crypto native but more a stablecoin native. actually bellow and lemon back in 2021 2022 was the way I I mean I was trying to skip inflation and that's where I discovered the bellow masterard and the lemon visa and I was like literally paying all everything with that and I was like this is a better way of doing things and I think Argentina right now is in the right moment like we have been preparing for the last 20 years actually around 20 years ago was the coralito So we need to the the the like the political environment and everything is like in the right direction to to to convert Argentina into a kind of like a Silicon Valley of of of crypto worldwide. I think that what the the camera fintage the the CNB which is our SEC is doing with the tokenization sandbox and everything is going to push startups and and start well and companies to to create better products and and push the limits not only for Argentina. I think from Argentina we are going to create different uh we are going to create for Latin America.

We're companies from Argentina are gonna are gonna dominate in Mexico, gonna dominate in Brazil, dominate in Colombia because of of of this like we have been preparing for this for 20 years.

Yeah, I agree pretty much with everything. Um I think we have been exercising a lot doing a lot [snorts] of preps on on this for a long time. Uh I think the the context the macro in Argentina it's getting nicer and nicer for uh for investments which is I think something that is still missing uh in part because you know uh don't have the the rule of law you know the kind of the the security for an investor to come here but you know by becoming um well the the country risk dropping and all those indicators allowing you know investors to come. I think that's pretty pretty interesting. Um I agree that we had all this preparation.

It's kind of a a a melting pot that will allow us to expand rapidly into other countries because even you see already some use case which we [snorts] have been doing a few years back to start popping up in some other countries. Uh definitely the whole tokenization play it's going to be massive. I think we will be seeing a lot of uh local stable coins uh starting to to mature and and evolve and and start you know getting gaining terrain. Um I I think the whole you know securities play also super interesting. Uh I would love to see how uh non-public companies start to tokenize their their assets.

Um just a a a comment apart my brother has a yogurt company and he's eager to tokenize his stocks in order to [snorts] receive money to invest into a new plant which is today impossible in any way uh through credit or or the the public market. So I think if we can kind of erase the libra uh you know uh moment from the past and think forward uh there is a lot of companies [snorts] and and and businesses eager to receive money and make this you know make [snorts] Argentina great again you know. Well,

cool. What a statement. Eh, Argentina, great. Again,

I like it.

Um, in terms of Argentina, I think that and and we have discussed this before, Diego, but I think in terms of Argentina, uh, regulators, uh, tax regulators in tackling the tax issue in Argentina for the crypto ecosystem. Uh, that is something that we really expect for the cabiner. I mean, having same kind of benefits that traditional banks do. they have for example the the the debit and credit tax. So that is something that we at least as as as industry expect for the coming year and in general terms we I mean um we expect more and more people adopting this kind of technology.

I mean we have a huge opportunity in Latin America. Six can six 600 million uh population in in in the whole in the whole um in in in the total region. So we have a huge huge opportunity. No, there are a few we are a few players that really really are are attacking this regionally and that we have presence in the different countries and we create that confident and trust with the users. So I expect that ecosystem growing and and hopefully more people using stable coins and our products and our solutions.

I mean as as Luca mentioned is cheaper is faster so why not? Well, thanks for your thoughts and thanks for the panel and well, make Argentina great again, right?

Thank you.

Thanks. Thank you, guys.