60 Latin American Banks Can Now Use Bitcoin for Cross-Border Payments

A leading bank technology provider in Latin America is partnering with cryptocurrency exchange Bitex to facilitate cross-border payments over the bitcoin blockchain.

"Bantotal is one of the biggest banking providers in Latin America and is a huge player not just in Latin American but the greater Pacific," said Sebastián Olivera, founder of the Uruguayan Fintech Chamber.

"With this technology, banks can have access to an API and have control of the whole process of payment with visibility and reliability on the bitcoin blockchain," said Beaudroit.

Calling it a "Quantum leap" forward for local banks in Latin America, Beaudroit said that average fees associated with cross-border payments are up to five times cheaper using Bitex than international wire transfers.

Bitex essentially acts as a middleman for national and regional banks to convert fiat payments into bitcoin then back into fiat, as opposed to completing multiple fiat-to-fiat conversions.

Normally, this process of transferring money across borders with local banks in Latin American can take anywhere from 48 to 96 hours depending on the specific bank branch and financial intermediaries used, according to Leo Elduayen, vice president of non-profit Bitcoin Argentina and founder of blockchain startup Koibanx.

With the Bantotal partnership, Elduayen suspects that accessibility to Bitex services for consumers in Latin American will dramatically increase though there are a number of hurdles still left "To get banks on board."

To this, Olivera said that both know-your-customer and anti-money laundering legislation is still a major issue for banks when it comes to using the bitcoin blockchain.

Federico Ast, CEO of Buenos Aires-based arbitration startup Kleros, agreed - adding that regulatory uncertainty and seeing cryptocurrencies "As a fad" are still major barriers to entry for Latin American banks.

"It's an ideal partner for banks to use bitcoin as a way of connecting banks in a way that is not very common in the industry yet is fundamental for markets like Latin America."