Nov 30, 2023

Hashdex co-founder and CEO Marcelo Sampaio shares insights into the state of crypto in Brazil amid the success of bitcoin ETFs in the country, as investors await the approval of a spot bitcoin ETF in the U.S.

Video transcript

The state of crypto is presented by Tron connecting the world to the power of Cryptocurrency. Welcome back to first mover. Our next guest is here to talk about the success of Bitcoin ETF S in Brazil as investors await the approval of a spot, Bitcoin ETF right here in the United States. Joining us now to discuss is hashtags co-founder and Ceo Marcelo Sampayo. Welcome to the show. Hello, thank you for having me. Thanks for being here. Now, Brazil has seen some pretty big demand for uh ETF S, talk to us about what's going on there and maybe compare it to the demand for spot Bitcoin. Well, Brazil uh it's little, it's quite a little known um in U SI guess but Brazil the process we're overcoming now in us around the Bitcoin spot ETF filings and the potential approvals we have got in Brazil uh through that like almost three years ago, right? So, and ultimately Brazil seem like is a more sophisticated market for crypto in general when it comes to regulated markets. Um What is going on right now, I think follows um um the trend, you know, like what's going on with Bitcoin like the Bitcoin narrative in general. But you know, like more than just in the crypto arena, you know, like this is happening here and the regulated uh uh uh uh environment. So, so, yeah, you know, like we have been seeing like not only man, but very interestingly, we have been seeing a number of, of, of, of pretty sophisticated investors, like maybe going towards like uh big institutions or more institutional investors really in like expressing their interest in, in, in joining, you know, like this, this asset class you like or having this asset class, like resenting the portfolios. It's been very interesting to see what happens a number of years, you know, like um ETF S are available in the market. Well, ETF S like this have been available in Canada too and I say this all the time on the show because I'm Canadian, but there hasn't been that much demand. Why do you think Brazil is different? Well, so, so one time, correct, like Brazil came before Canada and like, again, not a lot of people know this, you know, like it was around the same time, but I came like, um you know, like two weeks before. Um and uh and uh and the reason I think like this is happening in Briz, uh it's a number of factors together, but one is that we have, I think like uh uh potentially a stronger, like ecosystem of crypto here potentially than Canada sobra pre established and like, you have serious players, have a number of players, like um hashtags is definitely one of them, like, uh maybe, you know, like we're the leaders but like, you have, we have a number of other companies really, you know, like uh pushing, you know, like, uh um um the crypto narrative or, or, or educating the market in like, in a number of ways. Um other than this, like Brazil right now has uh what probably can be considered the best uh regulatory environment for crypto um uh in the world right now. So this is a lot of t not only to these companies but to, I think, you know, like a progressive mindset uh um in a pro market mindset of the regulators here, uh We do have a lot of uh uh uh lucidity or clarity of mind, like uh both in our version of the fed or central bank in our version of the SEC, it's called CV M. So, so put all these things together, you know, like it's, it has been increasingly creating in like an environment welcoming, you know, like more sophisticated, bigger, larger, more traditional investors to consider this asset class uh uh uh as something serious as something that they should get educated about to take a look. And this is happening right now as we speak. Let's let, let's talk numbers here because this, this is ultimately a signal, at least for American investors should there be an ETF in the United States. I know you don't want to talk about what hashtags is doing in the US. But if we could use Brazil as a guide, how much, uh how much Bitcoin let's say is being held by Brazilians right now versus how much is in the Brazilian ETF, the spot. ETF uh I know about 40% of Brazilians. The last survey I saw something like nearly half the country has crypto of some form but actual Bitcoin ver that they're holding versus the CTF. Let's compare what, what, what are our sizes here? Yeah. So compared to, to, to, to, to the size of the US market, uh I would assume it is fairly small. Um What is interesting to see some of the, the US market? Yeah. So ETF ETF versus, yeah. So, so, so ETF in general is still smaller than crypto directly. Uh What I think is interesting here is maybe when you take a look in the relative terms um of, you know, like the people that would not be trading crypto directly, but they are, you know, like in the regulated system joining. And this is something that uh you know, like that is pretty unique. So Brazil is the only country that we know so far that you have the largest financial institutions. We're talking about the largest banks. Our versions of JP Morgan is our versions of all the largest banks. Uh not only distributing crypto products through ETF S and in various fors. Uh, but actually, you know, like recommending to their, um, how much, how much do they own? Do we know, do we have cation? How much, like if I were to get all the Brazilians together and say, ok, guys, show me your, show me your bags. Let me see what's in your wallet. We add up all the big in the regulated market. We're talking about something close to a billion dollars aggregate in the regulated market. Uh the nonregulated the a regulated market. So talking about uh crypto exchange directly. This is so much bigger, right? Uh But we don't have this number clear, like because you have a number of verses, we don't have a reliable source that we can point to like this. How much are in ETF S, that's what I'm saying, like maybe even like getting close to, right? So the ETF S have about a billion. But then how much are, how much are being held by not ETF S in Brazil? Do we know? That's the thing? That's the number, you know, like we don't have, you know, like any, any source to, to points or like because it's just estimation, a number of people, we can go in like through tax payment and then we would say something, you know, like uh 56 X times of it. But again, this is not a reliable source that, that's why I like uh I don't have really a number to, to, to show you that I can be confident or not, but it is bigger, right? I think that the main point that it is still bigger because in like Brazil is a country that crypto has been adopted pretty early on, right? You have a lot of activity and more and more like now regulators are pro but what I'd like to, to point is really the relative numbers. What happens, you know, like uh with portfolios of people that would not be trading would not be considering crypto in like in the portfolios. You know, like when you do have regulated alternatives that really the finance, the largest financial institutions in the country can actually uh trust, you know, like can rely on. Uh and like really to, to, to recommend to, to, to, to, to their partners, uh this site for crypto, you know, like in the relative numbers is bigger than probably anywhere else. Al although the absolute number is smaller than a number of bigger economies, Marcelo, we're gonna have to wrap it there. Thanks so much for joining the show this morning. Thank you so much for having me. Of course. All right. That was hashtags co founder and Ceo Marcelo Sampayo.

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