Coinbase takes advantage of Mexico’s remittances market | Financial Buzz

Coinbase takes advantage of Mexico’s remittances market

Coinbase Global, Inc. (NASDAQ: COIN) is going global. Its plans are now taking shape as cryptocurrency recipients in Mexico will be allowed to cash out their funds in pesos. The company launched its pilot program on Tuesday, looking to be an innovative force in the global remittance market.

Global remittances were projected to have grown 7.3%, reaching USD 586 Billion in 2021, as reported by the World Bank. The flow of money into Latin America reached roughly USD 126 Billion in 2021, and Mexico was the largest recipient, receiving USD 52.7 Billion. This has presented an opportunity for Coinbase to increase its user base in the country, and if successful, the company plans to expand the program to other regions over time.

According to Coinbase, recipients will be able to cash out crypto in pesos at over 37,000 locations across Mexico or save the money in their Coinbase account. It will initially be free of charge through March 31st; then there will be a “nominal fee that’s still 25-50% cheaper” than other international payments options, as indicated on Coinbase’s website.

The cost of sending money across international borders is too high, according to the World Bank. Transferring through banks is the most expensive method when compared to digital channels and other money transfers services. Thus, cryptocurrencies, with their fewer intermediaries, borderless nature, and easy access, can be a solution for people to send money overseas.

 

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