Cryptocurrency

Crypto Exchange Bitso Raises $62 million in Expanding in Brazil

Bitso, a crypto exchange in Mexico, managed to raise $62 million to expand in Brazil. The exchange wants to make rapid strides in South America, which it considers a large market. 

A news article on Theblockcrypto has claimed that Mexico exchange Bitso raised $62 million in cash for it to expand to countries in South America like Brazil. They plan on increasing the number of users to double next year. 

In a press release, they said that they were able to close a $62 million fund in a Series B round that was done by QED Investors and Kaszek Ventures. Coinbase and Pantera Capital were also notable participants in the deal. 

They have not given the details about the valuation of the raise conducted or revenue figures. tablelead #startservingmore is a sales-as-a-service platform, had tweeted on Bitso raising $62 million as it wants to expand in South America. 

Bitso was able to raise $2.5 million in 2016 in a Series A1. During the time, they were valued at $10 million and had 6 employees working for them. Today, they have more than 200 employees working for them. 

Daniel Vogel, who is the CEO, explained that using the new inflow of money, they will want to expand in countries like Brazil, where the market is high. During an interview, Vogel told the Block, participants who took part in the Series B felt that the country has a robust potential growth opportunities. 

In caparison to Mexico, Brazil is quite big, and it is surprising that the exchange there, is bigger than what they have in Mexico, even like Bitso. They want to capitalize on that opportunity and do the exact same thing that they did in Mexico, to Brazil. 

Bitso has made its presence felt in Argentina and was able to make more than 75%. With their market in Brazil, there is a strong chance that the number of users could reach their target, which is 1 million, by 2021. 

He feels that the business of exchanges can be tricky and complicated for trading fees. That is because, they can collapse continually, but with strategic decisions like the one, they took, the increase of funds is on the rise to $35 billion by 2021.

Brazil’s Largest Brokerage Firm Grupo XP all set to Launch Crypto Exchange

Grupo XP, which is Brazil’s largest independent brokerage and the owner of XP Investomentios SA has also entered the crypto arena. The brokerage house is launching a Bitcoin and Ethereum trading exchange in the next few months, according to a Bloomberg report.

Fast-changing market dynamics at play

Guilherme Benchimol, the Chief Executive Officer of the firm stated his plans at an event held in Sao Paulo. There are a growing number of crypto enthusiasts in the country; with nearly 3 million Brazilians having exposure to Bitcoin trading. On the other hand, the number of Brazilians involved in stock trading/investment is much lesser at 600,000. Such an enormous exposure to cryptocurrencies has pushed Grupo XP to venture in this thriving business.
The exchange is going to be run by Thiago Maffra and will be set apart from XP’s other brokerage businesses. XDEX will the name for this crypto exchange and it will have around 40 employees. However, Grupo XP has entered this sector reluctantly. “I wish that this theme of crypto craze extending to Brazilian lands didn’t exist, but it does,” Benchimol said. “We were compelled by market dynamics to start advancing in this business.”

Brazil’s improving business climate for cryptocurrency trading

Brazil’s past has been full of skepticism with regards to cryptocurrencies, as its Central Bank Chief Ilan Goldfajn compared them with a bubble and a Ponzi scheme. However, Brazilian regulators are now obligated to accept this industry and are easing rules of business. This week, regulators issued a set of rules which allow funds to make investments in crypto-assets abroad but with certain limitations.
Grupo XP has been expanding rapidly over the past few years. It is targeting to raise 1 tillion reais ($245 billion) by the year 2020 and is also launching a bank in the next few months. The firm has also offered online investment platforms to Brazil’s growing middle class. Itau Unibanco Holding SA, a banking giant, agreed to buy a minority stake in Grupo XP last year.

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