Colombian Neobank Littio Shifts from Ethereum to Avalanche for Cost-Effective Currency Protection Amid Peso Struggles

Colombian neobank Littio just announced that it’s switching from Ethereum to Avalanche. Why? They want to offer customers a cheaper way to protect themselves against the struggling peso.

By teaming up with OpenTrade, a startup that provides stablecoin solutions through tokenizing real-world assets, Littio aims to take advantage of OpenTrade’s yield-bearing savings options. To meet growing demand, they’ll be moving their assets from OpenTrade’s Ethereum vaults, called Yield Pots, to those on Avalanche.

Avalanche supports the AVAX token and ranks as the 13th largest digital asset by market cap. It competes with Ethereum by allowing developers to build decentralized apps, like exchanges and NFT marketplaces.

OpenTrade pointed out that Ethereum isn’t the best choice anymore because Avalanche has lower transaction fees. Plus, Littio’s move to Avalanche is also based on the network’s compatibility with the Ethereum Virtual Machine, quick transaction finality, and reliability. Jeff Handler, the chief commercial officer at OpenTrade, explained this well.

Handler said, “Colombia is one of many Latin American countries facing currency devaluation. This makes financial stability much harder for local retail customers.” He also noted the strict onboarding requirements from local banks.

Littio gives customers a chance to save in U.S. dollars, especially with the peso losing value. Right now, 1,000 pesos buys just $0.24, which is down about 54% over the last decade. The bank already helps customers convert their pesos into dollars using USD Coin (USDC). Stablecoins can work on various blockchains, including major ones like Ethereum, Solana, and Avalanche.

Wall Street is taking an interest in Avalanche too. In August, investment firm Franklin Templeton made its Nasdaq-listed OnChain U.S. Government Money Fund available on the Avalanche network. They also cited low transaction costs as a reason for this move.