Littio, a neobank based in Colombia, has made it possible for customers to access U.S. Treasury bills through crypto products. The neobank has decided to switch its vault holdings from Ethereum (ETH) to Avalanche (AVAX) in order to meet the growing demand for its products. These products, known as Yield Pots, allow users to earn interest on their U.S. dollar deposits.
The decision to move to Avalanche was influenced by the chain’s low transaction fees and reliability. The Avalanche Foundation’s $50 million program to incentivize the development of real-world assets (RWAs) on its network has also played a role in this transition.
Through a partnership with OpenTrade, a London-based firm specializing in yield-bearing products using stablecoins and real-world assets like U.S. Treasury bills, Littio offers exposure to Yield Pots. Stablecoins are digital currencies designed to maintain their value in relation to a government-issued currency, such as the U.S. dollar. Real-world assets are assets that exist outside of the crypto ecosystem but are represented on-chain as digital tokens.
Jeff Handler, chief commercial officer at OpenTrade, stated that Littio is currently the only Latin American neobank utilizing their vaults, but more clients are expected to join this year to offer various USDC-based fintech services. The company operates in several Latin American countries, including Colombia, Argentina, El Salvador, Brazil, and Mexico.
Since the launch of Littio’s Yield Pots in February, the products have generated over $80 million in transaction volume. Users have received $250,000 in returns over the past four months. Littio reinvests between $11 million and $13 million in OpenTrade vaults each month.
The yield from Littio’s vaults ranges from 2% to 5%, as indicated on the company’s website. This product has attracted demand due to the significant depreciation of the Colombian peso against the U.S. dollar over the years, making the dollar an appealing alternative for investors in Latin America.
Customers of Littio may also face currency restrictions or challenges in opening traditional bank accounts, making the neobank a convenient option for accessing financial services. The partnership between Littio and OpenTrade showcases how Avalanche’s technology can empower underbanked populations to access innovative products and services that may not be available through traditional financial channels.
Overall, the transition from Ethereum to Avalanche is a strategic move by Littio to meet the growing demand for its Yield Pots and provide customers with access to U.S. Treasury bills through crypto products. The success of these products highlights the potential for blockchain technology to revolutionize the financial services industry, especially in regions where traditional banking services may be limited.