Argentines adopt cryptocurrencies to escape inflation

Recent surveys indicate a significant increase in the number of cryptocurrency users in Argentina, which has become one of the countries that uses the technology the most in the West. The change was probably motivated by the devaluation of its local currency.

Argentines and cryptocurrencies

The main virtual currency adopted by Argentines was Tether, a low-volatility currency that can be used to exchange for other currencies or to buy products. The use of cryptocurrency represents an efficient way for Argentines to get around, at least to some extent, the inflation that their country has been suffering in recent times, in addition to being a safer way to store money.

With the significant increase in the number of Argentine users, it has become common to see advertisements and media throughout the country promoting cryptocurrencies and where to buy them. The main target audience for these advertisements are young people, immigrants and self-employed workers, profiles that hold the largest share of the market.

Recent research indicates that cryptocurrency transactions in the country are already close to the number of traditional transactions. Because of this, in the same year, the government opened the Virtual Asset Service Provider Registry, as a way to regularize cryptocurrencies and the companies that provide them, and reducing risks for the population and for the country itself.

Even the Argentine government itself has been adopting Bitcoin for some types of transactions.

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Reasons for the growing use of cryptocurrencies

The country has been facing internal problems for many years, with inflation accumulating over 200% in its currency, the Argentine peso. In addition, the country has faced difficulties with one of its largest sources of income, agribusiness, which has been extremely affected by severe droughts, making its economic recovery even slower.

Faced with this situation, Argentines have sought to build up reserves in other currencies to use in emergencies or to offset inflation. However, the dollar, the most conventional currency, has had difficulty establishing itself among the population, which has found refuge in cryptocurrencies.

The technology offers numerous benefits, mainly security due to not having physical money, no purchasing restrictions and offering an alternative for self-employed workers and foreigners, who find it difficult to access dollars and make transactions with them.

It is expected that in the coming months the number of Argentines adopting cryptocurrencies will increase even further, putting pressure on companies, both local and foreign, to regularize themselves.

Featured photo: Argentine peso, Argentine currency (Reproduction/Marcia Almeida/Valor)