Mercado Libre, the e-commerce company that operates at a larger scale than Amazon across Latin America, is shutting down its cryptocurrency loyalty token Mercado Coin. The company announced through its Mercado Pago wallet that the token will cease functioning on April 17. No explanation was provided in the customer notice, and the company did not respond to requests for comment on the decision.
Users currently holding the token have three available options before the deadline. They can sell it through the app, apply it as purchase credit on the platform, or take no action and allow it to be automatically converted into local fiat currency. The process is designed to ensure holders are not left without recourse, though the token’s discontinuation marks a clear end to the project.
Mercado Coin launched in August 2022 in Brazil as an ERC-20 token on the Ethereum blockchain, developed in partnership with crypto exchange Ripio. The concept was straightforward: customers could earn tokens by purchasing selected products on the marketplace, then redeem them on future purchases or convert them to cash. Despite later expanding to additional markets beyond Brazil, the token never attracted a substantial user base and remained a niche feature throughout its four-year lifespan.
The token’s inherent price volatility is widely seen as a key factor in its failure to gain traction as a loyalty mechanism. In contrast, Mercado Libre has been moving toward more stable digital assets. In August 2024, the company launched MeliDolar (MUSD), a stablecoin pegged to the U.S. dollar, also built with Ripio and accessible through Mercado Pago. Unlike Mercado Coin, MeliDolar’s value does not fluctuate, as it is backed by U.S. Treasury securities and dollar deposits.
MeliDolar now serves as the foundation of the company’s Meli Plus loyalty program, where members receive it as cashback on purchases. Users can spend it on the platform, sell it within the app at no cost, or hold it as a hedge against local currency depreciation. This last feature carries particular relevance for consumers in Brazil and Mexico, where local currencies have faced sustained pressure. The move followed an earlier experiment that allowed users to interact with Paxos‘s stablecoin.
Mercado Libre is not the only major Latin American financial institution to have learned this lesson. Nubank, Brazil’s largest digital bank with over 100 million customers in the country alone, ran a comparable experiment with Nucoin, a loyalty and rewards token launched in 2023 on the Polygon network and airdropped to its vast user base. The token subsequently lost 97% of its value, prompting Nubank to suspend trading in September 2024 and give holders 90 days to convert their coins to Bitcoin or USDC. The project was fully shut down by December, leaving sixteen million users affected, with the bank running a prize campaign to soften the impact.
Despite stepping back from its own loyalty token, Mercado Libre has not abandoned digital assets entirely. The company continues to hold more than $38 million in Bitcoin on its balance sheet and maintains crypto trading and stablecoin transfer services through Mercado Pago. The broader infrastructure remains intact, even as the token that failed to find an audience is quietly retired.
Originally reported by Decrypt.
