On Wednesday (March 6th), Binance announced that Argentina’s Ministry of Production and Labour had agreed to give a grant of up to $50,000 to every Argentine blockchain project that gets funded by Binance Labs (Binance's incubator and venture capital arm). Over a four-year period, the government of Argentina "will match investments from Binance Labs and LatamEx, via Founders Labs, in up to 10 blockchain projects each year."
Via a collaboration with Founders Lab, "the only blockchain accelerator to be granted one of the Argentine government’s 10 Accelerator Licenses", Binance Labs will "host a 10-week incubation program for blockchain startups in Buenos Aires, one of the six cities exclusively selected as the program’s regional hub." Binance Labs invests in "early-stage blockchain developer teams through incubation, direct investments and limited partnerships."
But why did Binance Labs select Buenos Aires "as the Latin American hub" for "Season 2 of the Binance Labs Incubation Program" (which began this month)?
Binance says that Argentina, which is the third-biggest economy in Latin America after Brazil and Mexico, is "on the verge of massive blockchain adoption, from ATMs to transit systems," and that Argentina's "openness to cryptocurrencies is recently highlighted by the state public transport card’s move to accept the use of Bitcoins for card top-ups." Binance belives that such moves "have given the country a unique opportunity to be at the forefront of blockchain adoption."
Over the past year, Argentina, a country with a population of around 44 million, has experienced economic recession, high inflation, and currency devaluation. Upcoming presidential elections later this year are expected to only worsen the economic situation by introducing additional volatility.
According to a report on 21 September 2018 by Seeking Alpha, although this is not the first time that Argentina has experienced a financial crisis, this time it is different:
"Unlike other previous financial problems in Argentina, there are alternatives to the financial calamity that is increasingly taking hold. The biggest solution is Bitcoin, or BTC-USD and, according to the data, Argentinians are buying large amounts."
Binance says that currently "about 260 merchants in Argentina, including 190 in the nation’s capital Buenos Aires, accept cryptocurrency payments," and that the country has "eight Bitcoin ATMs, the second-most in the region (after Colombia, which has 40), according to Coin ATM Radar."
Ella Zhang, Head of Binance Labs, had this to say:
“Argentina is at the forefront of blockchain adoption and we’ve witnessed how it’s becoming home to some very passionate blockchain communities during our trip there. Our mission at Binance Labs is to realize the full potential of blockchain technologies. To that end, we are very excited to support blockchain projects, entrepreneurs and developers through our Buenos Aires chapter, to advise and mentor them, to find product-market fit, and provide them with in-time access to global blockchain technology development to solve local problems.”
She also clarified via a tweet in what form the Argentine government would be "investing" in the projects in the county being funded by Binance Labs:
"One clarification to the terminology ‘match investments’ means grant. It’s a pure grant initiative to support local founders. Government WON’T take any ownership or equity. We really appreciate the strong support from Argentina government to @binance & @BinanceLabs !"
And Pablo Orlando, Founder & CEO of LatamEx and Founders Lab, stated:
‘‘Latin America presents one of the most attractive markets for blockchain adoption and real use cases and Argentina is leading the way by serving as the market-opening gateway. Argentina, being hub to some of the best projects and entrepreneurs in the region will benefit tremendously from an ecosystem like Binance. I am confident the projects under the Binance Labs incubation program will contribute significantly to the blockchain community worldwide.’’
Featured Image Courtesy of Binance