In Argentina, a much-anticipated alliance appears to have been forged between Uber and Bitcoin, two forces widely regarded as among the most “disruptive” in the modern global economy.
The announcement by Xapo — a Switzerland-based company that offers a Bitcoin-based debit card and online wallet — could be used to pay for Uber rides is the latest in a long-running chess match in Argentina between the ride-sharing giant and regulators.
In the spring, a judge ordered the company to cease operations in Buenos Aires, after cabbies jammed the streets of the capital to protest its alleged flouting of taxi regulations. Then, the Argentine communications ministry was ordered to block the Uber app within Buenos Aires, and credit card companies were ordered to stop doing business with the company.
Xapo sent out an email earlier this week announcing that Uber would now be accepting the cards as payment, and it offered a 100 peso discount. “You support Uber but you cannot ride because they don’t take your credit cards? Now Uber also supports Bitcoin, and with your Xapo card you can ride inside or outside Argentina,” the announcement states, according to an English translation.
Nowhere has Bitcoin gained more popular acceptance than in Argentina, which has long suffered economic woes linked to fluctuations in the value of its peso. The digital currency, which unlike the traditional kind is not controlled by a central bank, is used for remittances, as well as everyday transactions.
Bitcoin is seen as having great potential across Latin America, in large part because so much of its population lacks access to formal banking services, while a far greater number have access to cell phones, which can be used for Bitcoin transactions.
“With such a large, connected, yet under-banked population, Latin America is the perfect candidate for Bitcoin to gain a foothold over alternative financial systems,” states one recent report.
Latin America has also proven to be fertile ground for Uber, which posted its strongest growth in the first quarter of this year compared to any other region where the company now operates. Uber is available in 45 cities and 10 countries in Latin America and boasts more than 2 million users a week, according to Bloomberg News.
Both Uber and Bitcoin are founded the principle of facilitating peer-to-peer transactions and circumventing traditional regulatory bodies. Bitcoin enthusiasts have eagerly anticipated being able to use the currency with the Uber app, and some have proposed hacks they say make it possible.
Uber, for its part, has denied that it intends to formally accept Bitcoin.