Latin America and the Caribbean is in some ways ahead of the curve when it comes to the adoption of digital assets.
El Salvador anointed cryptocurrency as legal tender last September, coinciding with a wave of “crypto-friendly” regulations rolling out across the region. And for socialist countries like Cuba and Venezuela, grappling with US sanctions, digital currencies have become a lifeline for buying goods and services.
The warm reception given to digital businesses is due to the relatively low penetration of traditional financial services in the region, combined with a painful history of inflation spikes, staggering exchange rate fluctuations and widespread familiarity with the methods Sophisticated payment methods in some countries that have adopted to combat high fraud rates.
“Given the serious problem of inflation and the need not to miss the train of technological development, the adoption of cryptography in Latin America has been very important,” says Marc Gericó, managing partner of Gericó Associates, a Madrid-based marketing and business development consulting firm for law. companies operating in Europe and Latin America.
Last year, Gericó began accepting cryptocurrency as payment for services to accommodate a client of an Argentinian law firm who was unable to pay its suppliers in a foreign currency.
The governments of some Latin American countries, including Argentina, limit the amount of local currency that can be exchanged for global currencies, such as the US dollar and Euro, in an effort to stabilize their exchange rates and their savings.
Meanwhile, the advent of smartphones has helped bridge the digital divide in Latin America and the Caribbean, opening up a multitude of services as well as dangers for consumers. For example, Brazil, a country of over 210 million people and the largest economy in the region, consistently ranks among those with the highest number of cyberattack incidents.
Law firms working in Latin America and the Caribbean are striving to keep pace with the next phase of the digital revolution by building capacity in areas such as data privacy, intellectual property, technology and consumer finance.
Gabriela Scanlon, a Brazil-born, Washington, D.C.-based litigator who joined Akerman in May as part of a rebrand for the US company’s consumer credit practice, sees huge potential for the data privacy and compliance work in Latin America as digital services grow.
A handful of Brazilian lawyers with deep data privacy experience have done thriving business since the country enacted a comprehensive data protection law in 2020 that largely aligns with EU regulations.
Scanlon sees this demand reaching the realm of qualified legal counsel in the United States as Brazilian tech companies expand and greenback transactions raise red flags with U.S. regulators.
“I don’t see any American companies offering these services in South America,” she said. “Crypto combined with different money transfer methods – it’s gold.”