As a seasoned financial analyst with a background in studying inflation and currency markets, I find Argentina’s current situation both intriguing and alarming. Based on the data presented in this article, it is clear that Argentinians are turning to cryptocurrencies, primarily stablecoins like USDT, as a hedge against their inflating local currency, the Peso.
Based on Forbes’ findings, Argentina boasts the most extensive cryptocurrency adoption amongst Western Hemisphere countries at present.
The persistent increase in the value of the local currency, the Peso, and the intricacies involved in obtaining dollars have fueled the recent surge in the use of crypto assets, particularly USDT.
Argentina Leads Crypto Adoption
According to a Forbes analysis, the use of cryptocurrencies is on the rise among Argentinians as they seek protection from the inflation of their national currency. This trend outpaces that of any other Western Hemisphere country.
As a researcher investigating the crypto exchange market, I’ve come across some interesting data. Based on an analysis by Forbes utilizing SimilarWeb, approximately 1.92 percent of the total user base in the top 55 crypto exchanges are based in Argentina. Notable exchanges in this country include Binance, eToro, BingX, HTX, and Bitget.
Chainalysis, a company specializing in crypto data analysis, found that Argentina ranked first in Latin America for total transaction volume, amounting to around $85.4 billion by July 2023. In contrast to numerous investors who acquire cryptocurrencies such as Bitcoin mainly for potential profits, Argentinians generally prefer purchasing stablecoins like USDT and synthetic dollars, valued at approximately $112 billion in the market.
The head of Latin America for BitGet exchange, Maximiliano Hinz, recently commented:
In Argentina, there’s a unique shopping trend when it comes to cryptocurrencies. Unlike other markets, a significant number of residents prefer purchasing USDT (Tether) without engaging in further transactions. This behavior is rarely observed elsewhere. Argentinians directly buy USDT at its current value and keep it without making any additional moves.
Inflation Driven Adoption
As a researcher studying the crypto market, I’ve come across Forbes’ findings on Argentina’s increasing adoption of cryptocurrencies. The high inflation rates in the country are identified as the main driver for this trend, with the Argentine Peso experiencing a cumulative 276% inflation rate over the past year. Such economic instability has led to noticeable changes in the local diet, with beef becoming less affordable and being replaced by more economical options like chicken and pork. Forecasters predict that steak prices could surge by nearly 600% in 2023, further emphasizing the need for alternative financial solutions.
Due to the depreciating local currency, Argentinians have been compelled to explore other options. One such alternative is purchasing dollars through the black market, where unfavorable exchange rates, potential dangers like robbery, and counterfeit money pose significant risks.
In more modern times, stablecoins have appeared to be an attractive alternative for Argentinians due to their direct link to the US dollar and convenient availability.
Javier Milei, Argentina’s newly appointed pro-Bitcoin president, is receptive to the idea of adopting the US dollar as legal tender. He believes that with an increasing number of currencies, such as the dollar and digital currencies like Bitcoin, becoming available, citizens will progressively rely on these alternatives instead of the Peso. Eventually, the Peso could be phased out altogether.
President Milei announced his plans for implementing dollarization and dismantling the central bank in order to prevent corrupt politicians from stealing through the manipulation of monetary printing.
Read More
- W PREDICTION. W cryptocurrency
- PENDLE PREDICTION. PENDLE cryptocurrency
- AAVE PREDICTION. AAVE cryptocurrency
- SEIYAN PREDICTION. SEIYAN cryptocurrency
- GBP CNY PREDICTION
- PIP PREDICTION. PIP cryptocurrency
- Why Did Persona Use the Term ‘Poo Poo’? A Dive into Localization Mishaps
- DAO PREDICTION. DAO cryptocurrency
- GhillieMaster: GTA Online: NEW Canis Castigator and Madrazo Hits, TRIPLE Money Bonuses, and More!
- Why Fortnite Players Believe Epic Games Forgot Key Characters from Pirates of the Caribbean
2024-07-15 08:21