Welcome to Latam Insights, a compendium of Latin America’s most relevant crypto and economic news during the last week. In this issue, Tether announces a sustainable Bitcoin mining project in Uruguay, Brazil’s President Lula proposes a shift away from the U.S. dollar, and Argentina advances its de-dollarization push.
Tether Announces Sustainable Bitcoin Mining Project in Uruguay
Tether, the company behind the issuance of the biggest stablecoin by market cap, has announced the start of a new sustainable Bitcoin mining project in Uruguay. As part of its recent expansion to the energy sector, Tether stated that it is now “investing in renewable energy sources to support and promote sustainable bitcoin mining—an essential component in upholding the world’s most robust and secure monetary network.”
Tether chose Uruguay for this operation due to the particular characteristics the country presents, stating that “an impressive majority of Uruguay’s energy production comes from renewable sources, making it an ideal environment for our energy-intensive operations.”
On this, Tether CTO Paolo Ardoino stated:
Our unwavering commitment to renewable energy ensures that every bitcoin we mine leaves a minimal ecological footprint while upholding the security and integrity of the Bitcoin network.
President Lula Proposes Latam Shift Away From the U.S. Dollar in Bilateral Settlements
Brazilian President Luiz Inacio “Lula” da Silva proposed the usage of alternative currencies to abandon the use of the U.S. dollar in bilateral settlements in the region. During the opening of a summit in Brasilia seeing the presence of 11 presidents of South America, Lula stated:
We must also deepen our South American identity in the monetary field through more efficient compensation mechanisms and the creation of a common reference unit for trade, reducing dependence on extra-regional currencies.
Lula has strongly advocated for de-dollarization, having recently abandoned the international price peg in the Brazilian fuel market, and openly supporting the issuance of a BRICS bloc currency.
Argentina Advances De-Dollarization Efforts; Expands Available Chinese Swap Line
The government of Argentina managed to expand a credit line in Chinese yuan to $19 billion with the Chinese government, opening an amount of $10 billion to be available for free management. The extension of this credit line is essential for the country, which is now facing a dollar shortage and limiting the use of its foreign reserves.
The extension agreement was signed by Central Bank of Argentina President Miguel Pesce and Yi Gang, governor of the People’s Bank of China (PBOC). The deal also allows the Argentine government to promote the use of the Chinese yuan in the national financial market, enjoying the same protections as the U.S. dollar, according to the Central Bank of Argentina.