Latin American e-commerce company Mercado Libre has introduced a cryptocurrency as part of its loyalty program in Brazil as it seeks to provide more value and experiences to its regular customers.
The company is using the new token, called Mercado Coin, to reward members of its loyalty program when making purchases through its marketplace. Mercado Coin is based on the Ethereum ERC-20 token standard.
"The blockchain technology supporting Mercado Coin allowed us to deliver a secure and open solution," Mercado Libre Chief Technology Officer Daniel Rabinovich said in a statement. "We continue to follow the evolution of crypto and blockchain as we see significant potential in these technologies to simplify operations and empower our customers financially."
Mercado Libre, known as Mercado Livre in Brazil, will add a "crypto logo" next to certain products in its Brazilian marketplace, which indicates that users can gain Mercado Coin rewards when purchasing those items. People with Mercado Coins can then use them to buy more items in the marketplace, or use the payments app Mercado Pago to exchange the cryptocurrency into Brazilian reais.
Latin American cryptocurrency exchange Ripio developed the technology behind the token, a Ripio spokesperson told The Block. Ripio is also responsible for providing custody and acting as the exchange for the Mercado Pago crypto transactions.
The new cryptocurrency will be progressively rolled out to Mercado Libre's Brazilian customers, starting with 500,000 users, the spokesperson confirmed. The coins will first start trading at 10 cents. These details were previously reported by outlets including Reuters and InfoMoney.
This launch of a new cryptocurrency builds on Mercado Libre's previous efforts to adopt digital assets in the past few years. The company has "assumed positions of $30 million as a crypto store of value," the company said in today's press release.
In December 2021, Mercado Libre started working with Paxos to offer users the ability to start trading and holding bitcoin, ethereum and the Pax Dollar stablecoin (USDP) through the Mercado Pago app. That feature gained 1 million users in 60 days. Then in January, Mercado Libre said it acquired shares in 2TM Group, the parent company of popular Brazilian cryptocurrency exchange Mercado Bitcoin.
© 2023 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.