Recently, the Brazilian stablecoin company Crown completed a $13.5 million Series A funding round at a $90 million valuation, led by Paradigm. The Block's press release explicitly highlighted that this is Paradigm's first investment in a Brazilian company. This funding round also marks Crown's second round of financing within just two months. In mid-October, Crown had just completed an $8.1 million seed round led by Framework Ventures, with participation from Coinbase Ventures, Paxos, and others.

This might not be front-page headline news, but there are two key points worth noting: Why Crown? And why Brazil?

Why is Crown Worth Investing In?

Analyzing this situation typically requires considering both internal and external factors.

From an external factor perspective, the author believes that investment opportunities in US-based stablecoin issuers are becoming scarce. Tether and Circle already dominate the vast majority of the market, forcing investment firms to look outside the US market to find greater Alpha. Furthermore, there are not many targets that allow foreign capital to invest in companies related to a local fiat currency, while also having a domestic market for stablecoins.

Brazil is a rare "treasure land" in the Americas that meets most of these conditions. We will discuss why later.

First, back to Crown. According to disclosed data, the total supply of BRLV, the Real (Brazilian fiat currency) stablecoin issued by Crown, is currently just over 100 million tokens, which translates to a value of less than $20 million USD. Its trading volume over the past 30 days is only $56,000. This indicates that the current market for domestic currency stablecoins in Brazil is not large, especially since Crown currently serves institutional clients only.

Clearly, the logic behind investing in Crown is betting that the team behind it can achieve success in this market in the future.

Crown's co-founder and CEO, John Delaney, is a former lawyer in international finance and was the COO of Xerpa, a prominent local Brazilian company that received investment from Founders Fund. In 2019, Xerpa launched an "Earned Wage Access" platform, allowing employees to withdraw their earned wages for days already completed at any time (instead of waiting for the end of the month), helping them avoid high-interest credit. This has been particularly popular in Brazil's high-interest rate and financial stress environment, seen as a tool for employee financial well-being. The company charges a small fixed fee, with no interest involved.

Co-founder and Chief Engineer Vinicius Correa was an early engineer at the Brazilian digital bank Nubank. Nubank's investor list is also impressive. Across multiple funding rounds totaling $2 billion, participating institutions included Sequoia Capital, Tiger Global, Goldman Sachs, Founders Fund, Tencent, and Berkshire Hathaway. Nubank went public on the NYSE in 2021 with an IPO valuation of $41.5 billion and currently has a market cap of nearly $80 billion.

Founding Partner and Ecosystem Lead Alex Gorra previously served as Managing Partner at the family office Brainvest, which manages $5 billion in assets, and had prior management roles at ARX Investments, UBS, Rothschild Bank, and J.P. Morgan. COO Bruno "BL" Passos previously led cross-functional teams at Hashdex.

Crown's founding team can be described as a veritable all-star team. Both co-founders have also been involved in the process of building Brazilian local businesses from 0 to 1. Although the current data for BRLV is not impressive, it hasn't prevented the company from raising over $20 million in total within two months.

Additionally, the Crown team stated in their blog that the essence of launching BRLV was also seeing the contribution made by USDT and USDC through the purchase of government bonds. Issuing stablecoins locally in Brazil can similarly provide purchasing power for government bonds, thereby stabilizing the economy, which in turn further stimulates the use of stablecoins—a win-win situation. If dollar stablecoins are just helping the US "stay afloat," then the Real stablecoin can be said to tangibly help the country.

Why Bet on Brazil?

In terms of the underlying fiat currency for stablecoins, there seem to be many choices better than the Brazilian Real. So why Brazil?

You might not believe it, but this country, which many 80s and 90s kids might last have heard of due to football, has become one of the largest innovation hubs in Latin America and a global leader, with over 1,500 fintech companies and more than 100 million users.

As a capitalist country, Brazil's banking sector has long been dominated by five major banks (Itaú, Banco do Brasil, Bradesco, Caixa, Santander), which hold over 80% of the assets, far higher than the US (around 50%). Traditional banking services were rigid, expensive (credit card APRs often exceeded 300%), and burdened by bureaucracy, excluding tens of millions of low- and middle-income individuals and the unbanked (historically up to 55 million) from the system.

But this also created a huge demand gap. Fintech companies like Nubank, starting with no-fee credit cards and offering simple, low-cost services, quickly filled this market void.

The Brazilian Central Bank, although unable to change the monopoly of traditional banking, surprisingly actively promoted competition and inclusion, even becoming a classic case in global digital financial regulation. Its biggest contribution was launching the instant payment system Pix in 2020. Pix supports free, 24/7 real-time transfers, with transaction volume exceeding one trillion Reais in 2025 and user coverage exceeding 90% of the population. Upon its launch, Pix quickly replaced cash and credit cards, becoming the preferred payment method for 76% of Brazilians, significantly enhancing financial inclusion and providing low-cost infrastructure for Fintech (such as payment and credit innovations integrated with Pix).

I believe everyone often sees integrations of Pix by various exchanges or Crypto payment tools in Web3 industry news. It is indeed not easy for the central bank of a capitalist country to lead the launch of a payment system powerful enough to shake the original banking system. However, this "pro-people" direction has also allowed local fintech companies to have better development prospects because they can reach more users.

It is precisely for this reason that new financial forms like cryptocurrency have high acceptance in Brazil. Brazil's population exceeds 200 million, with a smartphone penetration rate of nearly 90% and over 180 million internet users, averaging more than 5 hours online per day. Young, digital natives, especially Gen Z, have a strong demand for mobile finance. In September last year, Circle began supporting direct exchange of Reais for USDC.

The popularity of dollar stablecoins in Brazil has been analyzed in many articles as being due to the instability of the Brazilian national currency. However, based on the author's research from multiple sources, even if this is part of the reason, it only accounts for a very small portion. It seems now that if this reason held true, investment firms like Paradigm would not place such heavy bets on Brazil's domestic fiat stablecoins and fintech companies.

In fact, Brazil did experience multiple episodes of hyperinflation in the 1980s and 1990s, even reaching an extreme monthly inflation rate of 80%. However, in recent years, although the Real's fluctuations are still not small, for a country like Brazil, it has achieved decent results in stabilizing the currency value and reducing inflation. Brazil's inflation rate hovered between 4.5% and 5% in 2025, still above the central bank's target but sufficiently better than its neighbor Argentina.

While some Brazilian residents holding dollar stablecoins do so to hedge against the depreciation of the Real, especially against the backdrop of the Fed's interest rate hikes in previous years, more do so for practical purposes such as foreign trade, tax avoidance, facilitating capital flow, and trading cryptocurrencies.

According to Chainalysis data, Brazil's cryptocurrency adoption index ranks fifth globally, behind only India, the US, Pakistan, and Vietnam. Its cryptocurrency inflow from July 2024 to July 2025 reached $318.8 billion, far surpassing other Latin American countries.

Furthermore, according to data provided by crypto market maker Gravity Team, Brazil has adopted stablecoins as a tool for investment and cross-border payments. Stablecoins currently account for about 70% of the indirect capital flow from Brazilian local exchanges to international exchanges.

At this point, some might ask, since they already have a national payment tool like Pix, what is the significance of stablecoins?

BRLV, launched by Crown, has a feature not explicitly stated on its official website but mentioned in the press release: it shares the interest income from government bonds with stablecoin holders. In Brazil, this number is 15%. Although it's impossible to distribute all of it to holders, even half is a very attractive yield.

In the future, BRLV could also be integrated into the Pix system. For ordinary people or even the impoverished, there might be no motivation to exchange for stablecoins. But for those with ample funds, stablecoins not only do not affect payments but even allow them to "earn interest" just by holding them. In the future, they could also be traded seamlessly with dollar stablecoins and even participate in DeFi. In short, all these possibilities ensure that stablecoins will have sufficient demand and use cases in this land.

For most countries with weaker national strength, unable to maintain long-term stability of their currency and with scarce foreign exchange reserves, the US dollar and dollar stablecoins are a lifeline for their people. Brazil is precisely an exception among them.