Mexican bitcoin exchange Bitso has secured a seed-funding round led by Barry Silbert’s Digital Currency group which was participated in by Mexico-based angel investors.
With the new financing, Bitso plans to expand its team in Mexico and aggressively push its project to use bitcoin for cross-border payments across South America. Since the majority of the population has no access to bank accounts or credit cards, Bitso aims to provide the nation with a cheaper yet robust mobile payment platform by connecting its bitcoin exchange with Transfer.
Transfer is a lightweight banking initiative developed by the Mexican government as a collaboration with Mexican banks and corporations including Banamex, Inbursa, Telcel and Oxxo.
Similar to M-Pesa, the popular mobile payment service launched by Vodafone in Kenya, the joint project of Transfer and Bitso allows users to send pesos using bitcoin to more than 100 million cell phones in Mexico. The receivers can withdraw cash at Banamex or Inbursa ATMs, creating a nationwide network of bitcoin withdrawal locations, thus increasing national bitcoin adoption.
“Whether you are talking about new payments services that help facilitate faster and cheaper money transfers across the world’s most active remittance corridor, or mobile money and microfinance opportunities for Mexico’s underbanked consumers, bitcoin and blockchain technology is poised to transform financial services in Mexico and all of Latin America,” said Silbert. “Bitso is well-positioned to emerge as the region’s leader in bitcoin exchange and payments, and we are thrilled to partner with them to help build a big, important company in this emerging industry.”
Bitso to Emerge as Leading Mexican Bitcoin Exchange
Launched in April 2014, Bitso is one of the most prominent bitcoin exchanges in Mexico, with top-tier security standards and strong focus on regulatory compliance. To compete against Mexico’s leading exchanges like Volabit and meXBT, Bitso recently acquired Unisend Mexico, a bitcoin exchange which operates in both Argentina and Mexico.
“Through Bitso, we have enabled an efficient and low-cost backbone for cross-border transactions,” explained Bitso founder and CEO Pablo Gonzalez. “We believe this will be a powerful rail to streamline international B2B payments, and remittances to the millions of unbanked and underbanked Mexican citizens.”
Founder talks Bitcoin Adoption in Mexico
“The most exciting aspect we are seeing firsthand is all the cross-border payment applications that are just beginning to happen: remittances, B2B payments, etc. Mexico is a hotbed for global payments,” Gonzalez told Bitcoin Magazine. The US-Mexico corridor is the largest in the world with $24 billion USD-a-year flow. International trade and commerce is even larger. $360 billion USD a year, and it is bi-directonal ($761 billion total.) Several partners, including traditional remittance companies, bitcoin remittance startups and cross-border payment businesses, have been running tests and pilot programs for the past few months.”
Gonzalez said that Bitcoin adoption has been growing steadily month-on-month in Mexico, as more businesses have begun to accept bitcoin payments.
“We talk to the regulators on a regular basis,” he said. “It is positive overall. They are very excited about the potential … However, they feel it is premature to regulate,” he said, a view similar “to some of the conclusions taken by the Canadian Senate recently.”