Yesterday Latin American online retailer MercadoLibre announced the launch of its own cryptocurrency, MercadoCoin, to be used as part of its loyalty program, initially in Brazil.
Users will earn MercadoCoin in a similar way to cashback when they make online purchases. Customers can redeem the tokens against purchases or trade them on the MercadoPago crypto exchange (only), which the company launched in late 2021.
MercadoLibre is part retail, part fintech, with $8.5 billion in e-commerce sales and 82 million visitors in the quarter to June 30. Its fintech arm MercadoPago posted $30 billion in payment volumes during the same period. In some ways, the company is a mix of Amazon and Block (formerly Square) for the Latin American region with a significant mobile Point of Sale footprint.
According to Reuters, the initial rollout is limited to 500,000 clients, but the company expects the offering to be fully available in Brazil by the end of the month.
MercadoLibre has long been interested in the blockchain and crypto sectors and was a member of the Libra / Diem stablecoin association.
Meanwhile, loyalty is a key real world application for blockchain, cryptocurrency and NFTs. A few years ago, several airlines, including Singapore Airlines, Cathay Pacific, AirAsia and Emirates, started to use the technology to make it easier to track how travel points are used.
More recently, Japan’s largest bank MUFG launched a wallet for utility tokens that can be used by retailers for rewards. And Belgium’s KBC Bank launched its Kate Coin for the same purpose. One of the biggest proponents of using crypto for rewards is Bakkt, founded by New York Stock Exchange operator ICE.