Nubank and MercadoPago paused crypto deposits and withdrawals in Latin America, citing issues with a risk‑monitoring data provider, not a breach of their custody partner Paxos.
Nubank, the largest neobank in Latin America, and MercadoPago, the fintech arm of Argentine e‑commerce giant MercadoLibre, announced on Friday that they are temporarily suspending crypto deposits and withdrawals. Both companies attributed the disruption to “instability in external data providers,” specifically a risk‑monitoring and anti‑money‑laundering service that supports their crypto operations. The pause affects only transfer functions; buying and selling of digital assets remain available.
According to statements released by the two fintechs, an incident at a third‑party risk‑monitoring provider caused instability in the crypto asset transfer pipeline, prompting a pre‑emptive halt to withdrawals to protect users. Nubank emphasized that its internal infrastructure and customer security were unaffected, while MercadoPago warned that deposits would be credited later once the issue is resolved.
Social media users quickly speculated that the outage might be linked to a hack of Paxos, the custody provider for both firms. Paxos, however, has not confirmed any breach, and its status page shows no incidents reported on November 6. Both Nubank and MercadoPago clarified that the problem lies with the external data provider, not their custody arrangements.
The suspension comes amid heightened scrutiny of crypto security in Latin America. Just days earlier, Brazil’s leading exchange Mercado Bitcoin reported a theft of over $46 million in digital assets, leaving withdrawals suspended on its platform. The incident follows a high‑profile theft at Binance, where attackers stole more than $6 billion from a hot wallet. These events have amplified user anxiety across the region’s fintech ecosystem.
Investors and users should monitor updates from the risk‑monitoring provider to gauge when transfer services might resume. Paxos’ status updates will also be closely watched for any signs of compromise. Additionally, regulators in Brazil and Argentina may increase oversight of fintech crypto services, potentially affecting how such platforms manage third‑party risk in the future.
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