On August 24th, the financial tech sphere was abuzz with an announcement from Argentina’s Num Finance. The company unveiled its nCOP, a stablecoin pegged directly to the Colombian peso. This move, seen as a strategic step, aims to leverage the thriving remittance market in Colombia, which annually sees an inflow of over $6.5 billion.
The significance of remittances in Colombia is undeniable. They account for a crucial part of the nation’s incoming capital. Recognizing this immense potential, Num Finance’s launch of the nCOP is designed to capitalize on this trend, offering a stablecoin tailored for the remittance market.
But the nCOP isn’t just any other stablecoin; it comes with the “Num yield feature.” This special feature enables users to receive rewards in nCOP, adding another layer of utility. Agustín Liserra, the CEO of Num Finance, shed light on this innovation, highlighting Colombia’s untapped potential to “tokenize” remittances and provide yields in nCOP, built on regulated financial constructs.
The journey for Num Finance in the stablecoin domain isn’t nascent. They’ve successfully introduced the nARS (pegged to the Argentinian peso) and the nPEN (pegged to the Peruvian sol). With a robust pre-seed funding of $1.5 million led by the Reserve protocol, the company has showcased its prowess in the stablecoin sector. It’s worth noting their ambitious plans which involve the introduction of stablecoins linked to the Brazilian real, Colombian peso, and the Mexican peso.
In a broader perspective, Colombia’s central bank is mulling over the idea of a central bank digital currency (CBDC). The bank’s vision for the CBDC includes facilitating remittances. However, they have voiced concerns, suggesting that any future CBDC should have holding and transactional limits to safeguard the nation’s financial equilibrium.
In a twist of events, the very day Num Finance broadcasted their nCOP news, Mastercard announced its decision to halt support for Binance’s crypto debit cards across multiple Latin American countries, including Colombia. This withdrawal can be seen as an opening, potentially giving innovations like nCOP a larger playing field in the region.
In other related news, Ark Invest and 21Shares, after their 2021 partnership to launch a spot Bitcoin ETF, faced setbacks with the SEC in March 2022 and January. The SEC’s skepticism about Bitcoin spot ETF applications led ARK 21Shares, and other applicants to augment their applications with a surveillance sharing agreement. As the crypto world awaits, the outcomes for Ark 21Shares Active Bitcoin Futures ETF (ARKA) and Ark 21Shares Active On-Chain Bitcoin Strategy ETF (ARKC) are keenly anticipated.
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