Brazilian companies turned to stablecoins on election day to dodge a currency crash
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Brazilian companies entered a crypto trading frenzy on Sunday to protect their treasuries from the outcome of an election that saw incumbent President Luiz Inácio Lula da Silva, known as Lula, unexpectedly beat Flávio Bolsonaro.
Key facts
- The surge extended into Monday, with combined USDT and USDC turnover reaching 1.84 billion reais ($350 million), 65% higher than in the previous week, while bitcoin trading rose more than ninefold
- Diversified RWA stablecoins sustain 5-7% yield from real credit as crypto funding compresses to ~4%
- Corporate concerns materialized the next day, when the benchmark Ibovespa stock index crashed 14% in its worst performance since March 2020 and the dollar jumped more than 8% against the real
- Corporate accounts generated 78% of trading on crypto exchange Mercado Bitcoin, with turnover in Tether’s dollar-pegged stablecoin, USDT, jumping nearly 800% from the week before and more than triple
Summary
Corporate accounts drove 78% of Mercado Bitcoin’s election-day volume as companies sought to hedge currency risk while traditional markets were shut, the exchange said. USDT volume on Mercado Bitcoin jumped nearly 800% and bitcoin volume surged 865% from the previous Sunday. The Ibovespa fell 14% Monday, its worst day since 2020, after incumbent Luiz Inácio Lula da Silva beat Flávio Bolsonaro, whom prediction markets had priced as a roughly 80% favorite. Corporate accounts generated 78% of trading on crypto exchange Mercado Bitcoin, with turnover in Tether’s dollar-pegged stablecoin, USDT, jumping nearly 800% from the week before and more than triple the average of the four preceding Sundays.