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Latin America’s Biggest Investment Bank Launches Stablecoin

Brazil’s BTG Pactual, one of the biggest investment banks in the Americas, launched its Polygon-based dollar-backed BTG Dol stablecoin.

BTG Pactual, an investment bank based in Rio de Janeiro, announced via press release that they have launched a stablecoin backed by the US dollar – the BTG Dol token.

In the statement, BTG Pactual’s Head of Digital Assets André Portilho said that the stablecoin will allow investors access to “easier, safer, and smarter” ways to put their equity into dollars.

The biggest investment bank in Latin America, BTG Pactual confirmed that BTG Dol will run on Polygon, the blockchain whose native token is MATIC, the 10th largest cryptocurrency by market capitalization. 

Polygon is a sidechain network that works alongside the Ethereum blockchain network, and is popular amongst developers and big brands like Starbucks and Disney.

BTG Dol is available on BTG Pactual’s proprietary crypto platform Mynt, and through the bank’s  own investment system, according to the announcement. Clients will be able to put in as little as 100 reais (approximately $20) to invest in BTG Dol.

What’s the fuss about stablecoins?

Stablecoins are a type of cryptocurrency that is pegged to a stable asset. These stable assets are typically traditional or fiat currencies, or commodities like gold. In BTG Dol’s case, they’ve decided to back the stablecoin to the US dollar.

Stablecoins make it easier for crypto users to efficiently enter and exit trades without the need for a traditional or fiat currency – making it a crucial part of the crypto ecosystem. Within the top 10 biggest digital assets by market cap, two of them are stablecoins: Tether (USDT), and Circle’s USDC.

Traders can just have stablecoins sit in their crypto wallets to be cashed out later. With the added safety and privacy benefits of crypto in mind, stablecoins are also important in inaccessible, restricted, unstable markets, and non-custodial lending and trading products in the DeFi (decentralised finance) sector.

But regulators around the world have pegged stablecoins as a threat to the world’s current financial system. As the globe observed collapse upon collapse of stablecoins, regulators have grown increasingly worried about potential failures, and the greater impacts on traditional market stability to come. Thus, lawmakers – like those in the US – have called for regulation on stablecoin issuers.

Brazil and crypto

Brazil boasts the title of being Latin America’s largest economy. In the context of the Americas, Brazil has the third largest economy in the region, trailing after the US and Canada.

Brazil is also home to Latin America’s most active crypto market, and tradFi has been quick to adapt. Many of Brazil’s major banks already offer investors the option for digital asset exposure, and the country offers more Bitcoin ETFs than any other nation in the region.

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