Grupo XP, the operators of XP Investimentos SA, is reportedly launching an exchange that will trade in Bitcoin and Ethereum.
The XDEX Bitcoin Exchange
According to Bloomberg, Grupo XP is launching a cryptocurrency exchange soon. The planned exchange will trade in Bitcoin and Ethereum. The Chief Executive Officer of Grupo XP announced in Sao Paulo.
In Brazil, about 3 million citizens are exposed to Bitcoin and other cryptocurrencies while only 600,000 citizens invest in the stock market. Looking at this statistic, venturing into the crypto market is the obvious step for a financial services company as big as Grupo XP, even if they’d rather not.
Speaking on the group’s decision, the CEO Guilherme Dias Fernandes Benchimol said:
I must confess, this is a theme I’d rather didn’t exist, but it does. We felt obligated to start advancing in this market.
The exchange called XDEX will be headed by Thiago Maffra and will be operated separately from the group’s other businesses.
Grupo XP is following in the footstep of other established traditional financial services companies that have ventured into the cryptocurrency market. SBI Group, a financial services company group based in Japan launched a Virtual Currencies Exchange in June. Swiss financial giant, SIX Group has also expressed its openness to engage in cryptocurrency trading.
Cryptocurrency in Brazil
The crypto market in Brazil is growing with exchanges seeing a surge in user registrations this year. As earlier reported by EWN, at least 30% of all Brazilians are interested in crypto Investments.
Despite the absence of government regulations on cryptocurrency trading, some government sectors have recognized virtual currencies. Tax authorities in the country charge income tax on the sale and purchase of cryptocurrencies.
Earlier in the year, the CVM (Brazil’s equivalent of the US SEC) announced plans to issue a document to guide fund managers participation in global cryptocurrency markets. A Director at CVM speaking on the agency’s plan said that the report will explain the circumstances under which indirect investment by funds in cryptocurrencies will be permitted.
Other players in the financial sector like banks do not look favorably on cryptocurrencies in the country. Crypto exchanges are engaged in a constant tussle with banks; recently a large bank closed the account of an exchange firm. Regulators have had to step in, with the Administrative Council for Economic Defense commencing an investigation into some large banks.