After four years, Mercado Libre is reportedly phasing out its in-house cryptocurrency offering Mercado Coin.
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That’s according to a report Tuesday (March 31) from Coindesk, citing a notification from the eCommerce company’s digital wallet. Beginning April 17, users won’t be able to buy, sell or earn cash back in Mercado Coin, essentially ending its utility, the report added.
Mercado Libre launched the coin in 2022 as a way to reward users for making purchases on its platform. The program began in Brazil before expanding to other markets.
The Coindesk report said that users holding the coin still have options, like selling the tokens through the app, spending them as purchase credits on the company’s marketplace or waiting for an automatic conversion into the fiat currency, which will then be deposited to their accounts.
The report also noted that while Mercado Libre offered no reasoning for its decision, the exit is happening as many tech companies are reconsidering their approach to branded digital assets.
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PYMNTS wrote last year about the way the credit card industry — and credit card rewards — might provide a path for consumers to explore the crypto sector.
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“While many consumers have been hesitant to invest directly in bitcoin or other cryptocurrencies, earning them as a reward on a credit card makes the process more accessible,” that report said.
The system works like this: Consumers will usually use a crypto-rewards card the way they would any normal card to make purchases in U.S. dollars. The card issuer offers cash back rewards in the form of crypto rather than cash or points, with consumers typically earning 1%-2% back in crypto on their purchases.
The rewards are automatically credited in bitcoin or the relevant cryptocurrency to the exchange account connected to the card issuer and the user’s card account, letting them accumulate crypto over time without buying it directly. Depending on the issuer, users can keep their crypto, trade it or withdraw it to an external wallet.
Akbar Thobhani, the co-founder and CEO of sFOX, a crypto prime dealer and trading platform for institutional investors such as banks and hedge funds, said in an interview with PYMNTS that crypto rewards were similar to airline miles.
“Airlines figured this out early. There’s value attached to what they give out. Crypto rewards are no different,” he said.
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