Key Takeaways:
- Just one month after its June launch, Nubank, the largest digital bank in Brazil in terms of market value, attracted 1 million users to its cryptocurrency trading platform.
- The area of asset tokenization is another area the bank is looking into.
- Users of the platform can buy and sell ether (ETH) and bitcoin (BTC) using a cryptocurrency trading and custody service offered by Paxos’ blockchain infrastructure.
Since launching its cryptocurrency offering at the end of June, Brazilian bank Nubank has acquired 1 million cryptocurrency customers in Brazil. David Vélez, the CEO and co-founder of Nubank, revealed the benchmark and said they anticipated reaching it in a year, according to a NeoFeed report from August.
For an exclusive in-app cryptocurrency trading experience, the New York-based exchange and stablecoin issuer have teamed up with Nubank, which belongs to Bitcoin critic Warren Buffet. Customers of the US-listed broker can now buy, hold, and sell a select number of crypto assets, including Bitcoin, Ethereum, and Bitcoin.
At the launch, Nubank, which is backed by billionaire Warren Buffet, disclosed a plan to invest 1% of its cash in Bitcoin. The choice was made to emphasize the bank’s belief in and support for cryptocurrencies.
Although Neobank withheld information about the total amount invested in cryptocurrencies through the app or the average amount buyers spent, Nubank promised that more currencies would eventually be added to the crypto offering.
With a BRL $ 1.00 (about US $0.20) minimum per order, Nubank clients can trade cryptocurrencies through Paxos for a commission of just 0.12 percent to 0.18 percent of the trade value.
“Cryptocurrency is without a doubt a developing trend in Latin America, one that we have been closely monitoring and think will have a profound effect on the continent. But because customers either lack the knowledge to feel confident entering this new market or simply become frustrated by complex experiences, the trading experience is still very specialized” in a statement, Velez stated.
Given that the company has a reputation for working with clients who are more sophisticated, Nubank’s entry into the digital asset space is noteworthy. Fintech, which has 50 million users and is one of the biggest digital banks in the world, made its New York Stock Exchange debut in 2021 and was valued at $52 billion, making it the region’s most valuable financial institution.
Even though Nubank’s stock price has fallen since then, the business is still well-positioned for expansion given that Brazil alone accounts for more than 25% of Latin America’s $500 billion crypto market.
Paxos is able to provide a variety of products, including custody services, crypto trading, and settlement thanks to its status as a licensed financial services provider in the US. The company can also issue tokenized securities and give its clients access to the conventional banking system.
Without providing any additional information, Nubank CEO David Vélez stated to Brazilian media outlet NeoFeed that the bank is also aiming for the tokenization market.
