Mercado Bitcoin, a Brazilian-based cryptocurrency exchange, has recently revealed that it would be making a foray into the Mexican market and starting operations in the second quarter this year.

Reinaldo Rabelo, Mercado Bitcoin CEO, said the company was awaiting regulatory approval so it could kickstart operations in Mexico.

The specifics of the expansion are unknown, but Rabelo stated in April that buying a crypto exchange was a simpler way to enter a new market than going through the rigors of building a new one.

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In an interview, Rabelo said:

“Certainly, in the second half of the year we start operating in Mexico,” adding that talks for regulatory clearance in Mexico are in their final stages.

Mercado Bitcoin Cautiously Treads Latin America

According to the CEO, Mercado Brazil parent 2TM Group now sees the Latin American crypto industry with prudence in light of downturns in the current crypto bear market.

2TM maintains offices in Brazil and Portugal via Criptoloja, Bitrust, Blockchain Academy, and Portal do Bitcoin.

2TM obtained $200 million from Softbank around a year ago, with plans to use the funding to set up more locations across the Latin American region.

Image: Seu Dinheiro

Despite having a presence in Portugal thanks to a recent acquisition, the company continues to do business solely in Brazil.

Mercado Bitcoin’s platform, which was founded in 2013, has seen a dip in trading volumes very similar to those seen in the crypto market, according to Rabelo, who hesitated to disclose exact and updated numbers.

Mercado Bitcoin’s platform, which was founded in 2013, has seen a dip in trading volumes very similar to those seen in the crypto market, according to Rabelo, who hesitated to disclose exact and updated numbers. Last year, Mercado Bitcoin reported a trade volume of 40 billion reais ($7.31 billion).

BTC total market cap at $448.5 billion on the daily chart | Source: TradingView.com

Mercado Bitcoin To Go Head To Head With Another Crypto Exchange

If Mercado Bitcoin expands to Mexico, it will most likely compete with Bitso, a crypto exchange that presently serves the country as well as Colombia, Argentina, El Salvador, and Brazil.

Some Mexican senators have supported legalizing Bitcoin, as neighbor El Salvador did in September of last year, but there are also proposals to launch a central bank digital currency in 2024.

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It is projected that around 10 million Brazilians, or roughly 5% of the population, presently own cryptocurrency. Around 91 percent of Brazilian crypto users are men, and 40 percent of crypto holders are between the ages of 20 and 25, a survey by Triple A shows.

Brazil is fifth in the world in terms of bitcoin ownership. According to a Triple A’s study, Brazil tops South America in terms of cryptocurrency-active owners, followed by Colombia, Mexico, and Argentina.

Meanwhile, Rabelo predicts that the bear market will continue to rear its ugly head to the broader crypto industry until the end of 2023, with the market stagnating and fewer capital accessible.