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Spain's cryptofever running hot

Stefanie Claudia Müller
May 20, 2021

Being among the early adopters of cryptocurrencies, Spaniards have turned their country into a hub of blockchain technology. Now, retail giant El Corte Ingles is getting in on the buzz with a coin called Bitcor.

An outside view of the El Corte Ingles department store in Madrid
El Corte Ingles's Bitcor coin is intended to ensure closer customer affiliation, while opening the door to the cryptoworldImage: Corte Ingles Madrid-Callao

Daniel Santos has long dreamt of striking it rich in the cryptoworld. The young Spaniard has made a name for himself as Mr. Santos via a YouTube channel of the same name which enjoys a following of 300,000 active watchers.

Calling on his intimate knowledge of all things crypto, he launched a digital currency network in Mexico four years ago called Woonkly that aimed to finance social projects with cryptocurrencies. Now he's returned from the United States, where he lived for a few years, to settle in Spain — currently said to be the hottest place in Europe for the global cryptocommunity. 

At the moment, Spain is home to about 1,200 companies devoted to creating alternative digital currencies. Daniel Santos has decided to join Crypto Plaza, a technology startup incubator based in Madrid that offers coworking spaces and the technical infrastructure surrounding applications running on the so-called blockchain network environment. 

Blockchain frontrunners

The country on the southern periphery of the European Union was among the early adopters of the blockchain technology and is readily embracing the myriads of digital coins that have emerged as new forms of virtual payment services.

The latest entry to Spain's booming cryptoculture, for example, is the El Corte Ingles department store, which proudly claims to be the biggest chain of its kind in Europe in terms of revenue. The company was among the Continent's online payment pioneers, issuing digital payment and bonus cards named Cortisoles long before its competitors. Now they've launched Bitcor, a cryptocurrency that aims to establish the company in the new world of digital payment services well ahead of their commercial breakthrough. 

Javier Rivas, blockchain expert and lecturer at the Madrid EAE Business School, said EL Corte Ingles is walking in the footsteps of US retail giant Walmart, which introduced its WalmartCoin back in 2019, pegging the token to the US dollar and offering discounts for payments with it.

The Spanish department store, he told DW, was promoting its financial services, including consumer credit and insurance portfolios, with the Bitcor token expected to become the preferred payment method of its 11.5 million debit card holders, he added. 

A picture of Javier Rivas with him standing next to a billboard reading EAE Business School
Javier Rivas has observed Spain's rapid ascendency as a hub of cryptocurrency developmentImage: EAE Business School Madrid

Banks in the 'sandbox'

Spain's impressive cryptorevolution doesn't come as a surprise. When the country's railway network was expanded about 10 years ago, the Spanish government seized the moment and laid a comprehensive fiber-optic network. This has become the cornerstone of the current success in the digital economy.

About a year ago, the government in Madrid also established a so-called national sandbox — a real-time testing platform that is used to ensure regulatory compliance and security checks for financial operations, including cryptocurrencies and blockchain networks. Spanish banks like the country's biggest lender, Caixabank, meanwhile, are investing in sandboxes of their own to keep abreast of developments.

According to market watcher Coin ATM Radar, Spain ranks fifth in a global list of countries with the most ATMs for Bitcoin, the world's largest digital currency. It has 110 publicly accessible crypto-ATMs, compared with 9,046 in the US, 921 in Canada, 290 in the UK and 150 in Austria.

Recently, tourism officials in the capital Madrid said they are working on a cryptocoin to facilitate payment in the sector. Hospitality chain Hammam Al Andalus raised €24 million ($29.30 million) by issuing its Helysia token, an effort that was supported by Spanish banking regulator CNMV. The company needed the funding to finance its expansion and offered a 10% discount on investments in the euro-pegged coin. 

Are cryptocurrencies worth the ride?

'Changing the world for the better'

Businesses like Hammam Al Andalus and El Corte Ingles are, of course, primarily interested in using their digital tokens to secure their customer base long-term, said Javier Rivas. "I'd rather call their coins smart money and not new digital currencies," he told DW, as he made the distinction between a digital coin and a token coin, the latter not running on a blockchain network of its own, like, for example, Bitcoin or Ethereum.

No matter if it's a token coin or a digital coin, the small Spanish town of Lebrija has shown earlier this year that both can be put to good use. Introducing the Elio digital token to pay out pandemic assistance to families, authorities made sure local businesses were supported with the digital money as well.

The Elio became a success and convinced even those in the town who were hugely critical of cryptocurrencies and other new-fangled technologies that are currently classified under the term "decentralized finance" (DeFi).

Lebrija goes digital with Elio virtual currency

Nevertheless, enthusiasts like YouTuber Daniel Santos are still a long way from achieving widespread acceptance of alternative currencies and digital payment methods.

"I want to change the world for the better," he told a Crypto Plaza online gathering in Madrid recently, as he hailed cryptocoins as effective hedges against accelerating inflation in normal currencies.

His latest project is what he calls a neobank and comes under the name Saurus. It is intended to facilitate payments in crypto for goods and services by circumventing the regulatory hurdles set up by commercial and central banks. In Spain more than anywhere else in Europe, fewer people seem to be shaking their heads in disbelief at such a claim, because here the cryptocurrency train is already well underway.

This article was adapted from German.