Key Takeaways:
Latin America’s largest e-commerce firm, Mercado Libre, is terminating its Mercado Coin loyalty program, marking a strategic pivot to its dollar-pegged stablecoin just four years after the token’s launch. The company informed users the ERC-20 token will cease to function on April 17, pushing its user base toward the MeliDolar (MUSD) stablecoin for rewards.
"The decision reflects a broader trend away from volatile proprietary tokens for loyalty programs," said Diana Chen, a policy analyst specializing in digital assets. "Companies are realizing that the volatility and regulatory risks of custom tokens outweigh the benefits, especially when dollar-backed stablecoins offer a more reliable user experience."
Mercado Coin, launched in August 2022 on the Ethereum network in partnership with crypto exchange Ripio, allowed users to earn tokens on purchases and use them for discounts or cash out. The program failed to gain significant traction. In contrast, the MUSD stablecoin, launched in August 2024, is fully backed by U.S. Treasury securities and dollar deposits, providing a stable store of value and a hedge against local currency devaluation for its customers in Brazil and Mexico.
This move mirrors the recent failure of Nucoin, a similar loyalty token launched in 2023 by Brazil's largest digital bank, Nubank. After being airdropped to over 100 million customers, Nucoin's value collapsed by 97 percent, forcing the bank to suspend trading in September 2024 and terminate the program by December. Mercado Libre, which continues to hold over $38 million in Bitcoin, is keeping its crypto infrastructure but betting on stability over speculative loyalty points.
This article is for informational purposes only and does not constitute investment advice.
