Brazilian companies have turned heavily to dollar-backed stablecoins following the October 25 presidential runoff, with corporate accounts generating 78% of Mercado Bitcoin’s Sunday trading as Luiz Inácio Lula da Silva defeated Flávio Bolsonaro.
Summary
- Corporate accounts generated 78% of Mercado Bitcoin’s election-day trading volume as companies sought currency protection.
- USDT trading surged nearly 800%, while Bitcoin volume rose 865% on Mercado Bitcoin.
- Brazil’s Ibovespa plunged 14%, while the dollar gained over 8% against the real after Lula’s victory.
- Across monitored exchanges, USDT and USDC trading against the real rose 150% and 318%, respectively.
- Kalshi assigned Bolsonaro an 84% chance of winning before Lula secured the presidential runoff.
According to figures provided by Mercado Bitcoin, USDT turnover rose nearly 800% from the previous Sunday, while Bitcoin trading climbed 865%. Companies reportedly used the exchange to manage exposure to the Brazilian real while conventional financial markets were closed, ahead of a steep selloff when trading resumed Monday.
The election returned Lula to office after a closely contested runoff in which financial markets had anticipated a Bolsonaro victory. On October 26, Brazil’s Ibovespa index fell 14%, its worst session since March 2020, while the dollar gained more than 8% against the real, its strongest daily rise since 1999.
Corporate accounts dominate Brazil stablecoin trading
Mercado Bitcoin attributed the trading surge primarily to businesses protecting their cash holdings from exchange-rate uncertainty. Retail accounts contributed 22% of its October 25 volume, leaving corporate customers responsible for the remaining 78%.
Its dollar-linked USDT activity exceeded three times the average of the preceding four Sundays, according to the exchange. Bitcoin turnover rose even faster week over week, although the platform did not disclose absolute trading volumes in the figures cited.
Pedro Fontes, a research analyst at Mercado Bitcoin, said the election reinforced the case for diversifying beyond the local currency. In his assessment, stablecoins such as USDT and USDC allow investors to hold dollar-denominated assets when traditional foreign-exchange markets are closed.
The exchange’s explanation concerns its customer activity and does not establish the intention behind every trade. Stablecoin turnover includes purchases and sales, so higher volumes alone do not reveal how much money companies ultimately retained in dollar-backed assets.
USDT and USDC activity rises across Brazilian exchanges
Trading figures attributed to market tracker Biscoint indicated that the response extended beyond one platform. Across 10 monitored venues, USDT trading against the real climbed 150% from the previous Sunday, while USDC turnover rose 318%.
By Monday, combined USDT and USDC turnover reached 1.84 billion reais, approximately $350 million, or 65% above the comparable figure one week before. Bitcoin activity exceeded 1,336 BTC, more than nine times the previous Monday’s volume, according to the reported dataset.
Binance showed a similar concentration of trading in local-currency markets. Its BTC/BRL turnover increased 370%, even as BTC/USDT activity declined 25%; Bitcoin gained 9.4% when priced in reais but slipped 0.2% against USDT.
The differing returns followed the real’s depreciation, which lifted the local-currency price of dollar-linked crypto assets without requiring an equivalent gain in their global dollar prices. Cross-market turnover figures should not be interpreted as net capital inflows because every completed trade involves both a buyer and a seller.
Lula election result reverses market rally
The election result reversed the financial market’s response to the first-round vote earlier in October. After Bolsonaro finished ahead of Lula, the Ibovespa climbed 7.7% and the real strengthened by more than 4% against the dollar, as investors anticipated tighter control over public spending.
Ahead of the runoff, traders had weighed Lula’s proposals for additional social spending against concerns over government borrowing and limited room to raise revenue. Local equities and the currency subsequently sold off on October 26, when Lula secured another term despite expectations favoring his opponent.
Election forecasting markets had favored Bolsonaro. In an October 24 election preview, Kalshi assigned him an 84% chance of winning, although its analysis acknowledged that conventional opinion polls showed a tight contest.
The prediction-market prices represented market-implied probabilities, not polling percentages or guaranteed outcomes. Brazil had restricted access to Kalshi and Polymarket in April, leaving their election contracts unavailable through authorized domestic channels.
Brazil stablecoin market faces tighter regulation
Brazil entered the election with an established market for dollar-backed tokens and new supervisory requirements for cryptocurrency businesses. As crypto.news previously reported on Brazil’s election, the presidential contest took place under rules covering exchange licensing, transaction reporting and stablecoin-related activity.
The International Monetary Fund had raised concerns about stablecoin flows through Brazil’s financial system, particularly the oversight of cross-border transactions. Its scrutiny did not prohibit domestic trading of dollar-backed tokens, although certain regulated foreign-exchange settlement channels cannot use virtual assets.
Exchange operators face a separate October 30 deadline to apply for authorization with the Central Bank of Brazil. Binance has filed its license application through its local entity, BBrasil, while companies that fail to enter the authorization process must wind down their activities under the new licensing framework.
