A new payment method leveraging digital assets has emerged in Paraguay's financial market. Peanut, a non-custodial digital wallet service, has begun formal testing for its entry into the Paraguayan market. Designed to allow users to hold digital dollars and easily transfer or make payments without a local bank account, the service initially targets cross-border migrants, digital nomads, and cryptocurrency users.

Edgar Barrientos (also known as "Pumbi"), who is assisting Peanut's expansion in Paraguay, highlighted the service's core value in a recent local media interview as an extremely simple user experience. The goal is to conceal the complexities of traditional financial systems so that anyone can easily use cryptocurrencies and digital dollars in their daily lives, he explained.

Non-Custodial Structure and Simple Payment Mechanism

The most distinctive feature of Peanut is that it is a non-custodial wallet, meaning users retain full control over their assets. Because users directly own the private keys linked to their wallets, even if an issue arises with the Peanut service itself, they can safely protect and move their assets using other compatible wallets. On the security front, accessibility has been enhanced by introducing passkeys and device-level biometric authentication. The KYC (Know Your Customer) process is handled by a trusted third-party processor, reinforcing privacy by having Peanut receive only the final approval status.

The operation method is extremely intuitive. Users top up their accounts with digital dollars like USDC or other supported cryptocurrencies. Afterward, when buying coffee locally in Paraguay, there is no need to inform the merchant that it is a cryptocurrency payment; they simply request a standard card payment method. In the background, the user's digital dollar balance is automatically deducted, and the merchant settles the local currency payment just like usual through existing payment networks. From the merchant's perspective, there is no difference from a standard card transaction.

Target Audience and Scalability of Cross-Border Finance

Currently, Peanut does not support direct top-ups in Guarani via local Paraguayan bank accounts. Because of this, the primary beneficiaries are foreign visitors and digital nomads rather than the local Paraguayan population. Direct integration with Paraguay's local banking system remains a future task, and the exact implementation date has not yet been finalized.

Nevertheless, cross-border functionality linked with the financial systems of neighboring countries like Brazil has already proven its strong utility. In fact, during a pilot event, a Brazilian national successfully topped up their Peanut account with digital dollars in just 2 minutes via their home country's Pix system and smoothly completed a payment at a local bar. This demonstrates that it can be a highly useful alternative for foreigners whose assets are distributed across borders.

Fee Structure and Future Outlook

Holding digital dollars or making standard transfers within the Peanut platform incurs no additional fees. Costs only apply when consuming assets in other currencies, such as the Paraguayan Guarani.

During the currency exchange process, Visa's exchange rate is applied, along with an additional fee of 1% of the transaction amount. This is evaluated as minimizing complex fee structures to reduce the burden felt by users.

Starting with this pilot test in Paraguay, Peanut is preparing to expand its influence across Latin America. Attention is focused on how this attempt—bypassing the barriers of traditional bank accounts to enable a borderless financial lifestyle anywhere in the world—will bring changes to Paraguay's local financial environment.

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