- Exchange platform Coinbase will allow its clients to collect funds deposited in cryptocurrencies intheir local currency.
- This pilot program seeks to capture part of the gigantic market largely fueled by Mexican citizens working abroad.
- From January to November of last year, the value of money transfers made to Mexico reached $46.834 million USD.
Coinbase Global has announced the launch of a pilot program in Mexico that will allow residents in receipt of cryptocurrencies being sent from abroad to collect the funds in pesos. The statement was made in a press release posted on the platform’s blog.
The American crypto exchange is seemingly looking to get a slice of the gigantic global remittance market, the value of worth exceeded $700 billion USD in 2020, according to figures from the World Bank.
The ease and low cost of sending funds in cryptocurrencies such as Bitcoin has captured a lot of attention among users sending remittances back to their home countries, and an increasing number of users in many countries have adopted digital money as a form of payment.
Through Coinbase, whose main offices operate in San Francisco, California, it will now be possible for users to send cryptocurrency remittances to family and friends in Mexico, and for those recipients to collect them in their local currency, the company explained.
“We are introducing the ability for recipients in Mexico to withdraw their cryptocurrency holdings in their local currency,” Coinbase said. “The lower price of sending and collecting cryptocurrencies and the flexibility in how funds are stored will allow recipients to keep even more of their money.” Representatives from the exchange underlined.
On the Flipside
- The value of funds sent in the Mexican remittance market totaled $46,834 million USD between January and November 2021, recording a new historical record. If transactions from December of last year were to be included, that number would easily exceed $50 billion.
- The accumulated growth of remittances in the country has been 26.7% per year, reaching a maximum of 18 years, according to data from the Bank of Mexico.
To withdraw the funds sent in cryptocurrencies to Mexico from the United States or other countries, recipients must provide one of the redemption codes that Coinbase will be making available across 37,000 retail and convenience stores, as well as in financial companies distributed throughout the country.
The exchange detailed Bansefi, Soriana, Telecomm Telégrafos and BanCoppel as being among Coinbase’s operating partners that will offer the service.
Users will be able to make withdrawals in pesos or keep their funds in crypto. Likewise, the platform will offer recipients the possibility to exchange the funds into any of 100 other supported cryptocurrencies, including USDC.
Why You Should Care
- For the duration of the pilot program, which will run through to March 31st, Coinbase clients in Mexico will have no additional surcharges for use of the service.
“After that date, customers will be charged a nominal fee that will remain 25% to 50% cheaper than traditional cross-border payment solutions.”
The cryptocurrency market program could be rolled out to other regions in the future, Coinbase highlighted.