Rappi Launches Cryptocurrency Payments Pilot in Mexico

Rappi, a Colombian online food delivery giant has started accepting cryptocurrency payments in Mexico. The delivery app has collaborated with cryptocurrency platforms such as Bitpay and Bitso, allowing users to turn crypto into credit, and make purchases within the app.

Sebastian Mejia, Rappi’s co-founder and president said that “This project is the company’s first step into the cryptocurrency world. We are studying the crypto world with interest and believe that the future is the intersection of the crypto with traditional non-crypto businesses, with easy and uncomplicated user experiences.” [1]

Selected countries around 1,000 respondents per country surveyed in 2019. Source: Statista Global Consumer Survey

Venture Funding in Latin America In Q1

Venture funding in Latin American startups is running hot. Q1 investments are 28% higher than the year ago quarter. However, investors put $3.4 billion into funding rounds in Q1 of 2022. This figure is down 30 percent from Q4 2021. Round counts also fell, with later-stage posting the sharpest drop at just 15 reported rounds, down from 35 in Q4.

However, these numbers ought not to give an impression of doom and gloom as the region is coming off record highs. Latin America was ranked as the fastest growing region in the world for venture funding in 2021 and received around $19.5 billion in funding.

The majority of rising investment went to late-stage rounds with valuations rising in tandem. Mexico and Brazil account for 25 unicorns and the region’s population of ultra-high valuation populations grew briskly between 2020-2021.

Seed and angel investment held up at approximately $300 million in Q1 (approximately on par with the prior two quarters.) Integra’s Managing Partners, Francesca Whalen and Alfredo Vargas see seed-stage companies as resilient because founders continue to launch solutions for serious challenges. They are partnering with venture capital firms at attractive entry points across various sectors. [2]

Source: Crunchbase News

Venezuela Will Lead the World in Growth?

Venezuela lost 80% of their GDP between 2014-2020. In 2019 inflation reached almost 200%. The Venezuelan crisis was marked by corruption, hyperinflation, the world’s highest homicide rates, food and medicinal shortages and the largest exodus of refugees in the recent history of Latin America, according to the UN Refugee Agency.

The International Monetary Fund (IMF) said it would take a major economic change for Venezuela to get out of the hole it is in. However, as the nation reached has reached such lows the potential for growth exists.

President Nicolás Madura has begun adopting more pragmatic economic policies after years of corruption and aristocracy. After Maduro’s election in 2019 where he was in competition with no one, the assembly found it to be constitutionally incompatible and thereafter assigned Juan Guaidó as the President of the Assembly. Guadió’s influence has been nothing positive on Maduro and his policies. [3]

Argentina Is Doubling Down On its Lithium

South America’s Lithium Triangle (Argentina, Bolivia and Chile) represent a spectrum of success in extracting and commercialising the region’s lithium rich salt flats. Chile’s lithium is a significant portion of the national economy, and it will continue to be a key component in the global transition to renewable energy. Bolivia on the other hand has an industry which is nearly non-existent. Argentina exists between the two in something of a middle ground.

Argentina’s lithium output falls between its peers in the triangle. Chile produced 18,000 tonnes, or metric tons, of lithium in 2020, ranking second in global production behind Australia. Argentina produced 6,200 tonnes and have raised global awareness of Argentina as a rising power in the precious metals industry.

Currently Argentina operates two lithium mines the Incahuasi Project and Antofalla Project and the country has well over 60 programs in development. Rio Tinto put $825m to assume control of Rincon Mining in Argentina’s Salar de Rincon. Additionally, a South Koren steelmaker Posco investment $830 million to continue expanding their lithium capabilities in Argentina’s Hombre Muerto Salar. [4]

Chile Central Bank Floats Option of Faster Hikes If Needed

Chile’s central bank opted for an interest hike of 1.5 percentage points at its last meeting to leave them in a better position to speed up future increases if necessary. Bank board members considered a borrowing cost hike of 125,150 or 175 basis point at their meeting on March 29th.

Policy makers wrote “The 150bp option was the one that best fit in both technical and communicational terms with the intended message to be conveyed. “Such a decision left them in a more comfortable position to react to any deviation or to accelerate the adjustment if deemed prudent as new information would become available.”

Chile’s economy relies almost entirely on imported fuels and has been stung by oil prices hovering above $100 a barrel following Russia’s invasion of Ukraine. Additionally, staple goods of the local diet such as chicken and bread have also become more expensive due to a global rise in food costs. [5]

Source: Chile’s central bank

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