Demand for US dollar-backed stablecoins has gradually risen over the past years. This becomes more evident as the largest stablecoin, Tether (USDT) currently ranks as the third-largest cryptocurrency by market capitalization. Today, Ripio is looking to propel more demand for stablecoins in Latin America, starting with Circle’s USD Coin (USDC). This news follows on the heels of a recent partnership between Ripio and Circle.
Ripio brings USDC to its Latin American Users
Per the announcement, cryptocurrency service provider Ripio will introduce USDC liquidity and fund flows to its wallet and exchange platform. By leveraging Circle’s transactional services, the crypto company plans to enable swift conversion between local currencies and the USDC stablecoin. Additionally, more than 500,000 Ripio customers from Brazil and Argentina will be able to manage liquidity and custody funds on the wallet and exchange.
To step up the adoption rate, Ripio also launched a USDC stablecoin-interest yielding feature. The new service is exclusively open to the Latin American residents using this stablecoin. As such, residents from Brazil and Argentina can choose to earn higher rewards from the stablecoin, with 50 USDC minimum commitment. During the initial phase, the annual interest rate for the company’s yield-generating product is six percent.
The CEO of Ripio, Sebastian Serrano, commented:
“The addition of Ripio Earn for our customers in Argentina and Brazil is an enormous leap forward for those who want to participate in the DeFi economy and generate additional income from our interest-bearing accounts.”
Global Demand for Stablecoins
In general, the demand for stablecoins surged over the past few months. Reportedly, the USDC stablecoin in particular notes a near 500 percent increase year-to-date. During the start of the year, USD Coin had a market capitalization of over $400 million from the circulating supply at the time. Today, that market cap currently sits above $2.8 billion.
Among other things, the dollarized aspect of these cryptocurrencies is a factor pushing up the demand. Notably, several fiat currencies shedded value amid increased volatility, including the recent economic crisis spurred by COVID-19. There was a relatively increased demand for US dollar, with these stablecoins coming in handy for those who prefer digital options.
For instance, Ripio claimed it saw more than 800% growth in stablecoin transactions during the second quarter of 2020.