MercadoLibre bans crypto after PayPal's $750 million investment

18 Mar, 2019
by Joeri Cant
News
MercadoLibre bans crypto after PayPal's $750 million investment

Just days after receiving a $750 million investment from PayPal, MercadoLibre, a Latin American e-commerce giant, revealed that it will ban all cryptocurrency-related listings from its platform.

According to CCN, the Latin American e-commerce giant, which operates online marketplaces dedicated to e-commerce and online auction in nearly 20 countries, will not only ban its crypto-related listings, but as well all pre-paid gift cards and any digital assets utilized in games.

The MercadoLibre platform, which expects to strengthen its presence in the territories with the highest sales volume, being Brazil, Argentina, and Mexico, in a move to directly take on competitors such as Amazon and eBay, announced March 19th as the deadline for these changes in an e-mail to its clients.

In the same email, the company asks to finalize all listings related to cryptocurrencies and pre-paid cards for games as soon as possible, as they will be automatically dropped on March 19.

Sean Summers, the Chief Marketing Officer at MarcadoLibre, said that the deal between PayPal and MercadoLibre opens the door to communication channels between their operations teams.

'We’re going to identify collaboration areas, to understand how PayPal’s global know-how best complements MercadoLibre’s regional know-how', he said.

Read more: EOS founder: "Over the next two decades, Bitcoin will replace gold"

It is unclear why the company is making this unexpected move, however, one can expect that PayPal's recent massive investment of $750 million has something to do with it.

We know that cryptocurrencies have the potential to eventually disrupt major legacy payment systems like Visa, Mastercard and Paypal.

Chepicap recently reported that analyst Lisa Ellis claimed that it is not inconceivable that one day cryptocurrencies could rival and surpass major private companies that the general populace currently use to move money globally.

'Their core design characteristics, which are aimed at enabling ‘freedom of money’, are in direct contrast to the characteristics of most traditional, private payment systems', she said.

She added that unless these legacy companies embrace digital asset technology, they stand to be surpassed by the new systems.

So, it isn't too hard to see why the 'EBay of Latinamerica' did what they did after all.

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