A recent report highlights how crypto adoption is increasing in Argentina, mainly due to the problems of high inflation.
Argentina takes another step towards crypto mass adoption
Latin America’s leading market research/intelligence company for the payments industry, Americas Market Intelligence (AMI), has tracked the growth of cryptocurrencies in the region with a detailed report just released.
The first fact highlighted by the report is the huge growth in cryptocurrency adoption in Argentina. With 12% of the population in possession of cryptocurrencies, it has doubled countries such as Peru, Bolivia and Mexico. In the latest ranking of the Global Crypto Adoption Index by the company Chainalysis, the country was ranked 10th in the world.
All this in spite of the fact that the Central Bank was forced to tighten its restrictive measures on cryptocurrencies as expressly requested by the IMF in exchange for the restructuring of the country’s $44 billion debt.
The Central Bank justified these moves towards Argentina’s banking system to prevent the possible criminal use of cryptocurrencies. This attitude has not deterred the citizens of Argentina, who have had to cope with a double-digit inflation rate for over 10 years.
For them, as for Venezuelans or Colombians, cryptocurrencies are a valid means of defence against an inflation rate that has reduced 38% of the population below the poverty line in just a few years.
Which cryptocurrencies are most widely used in Argentina?
In addition to Bitcoin, Argentines are also increasingly turning to stablecoins as a means of keeping hard currency in their wallets, as shown by AMI’s report, especially since Argentina has long since imposed strict controls on currency exchange and the possession of foreign currencies.
This success can also be explained by the fact that some cryptocurrency-related activities, such as mining, are widespread, thanks to the relatively low cost of energy in the South American country.
In Argentina, there are already three start-ups offering debit card services for crypto-based transactions. One of these companies, Lemon, was founded in a town in Patagonia, where as many as 40% of shops accept Bitcoin. The exchange surpassed 1 million users last month.
There are as many as 7 different exchanges in the country, through which it is possible to exchange and trade cryptocurrencies. Santiago Siri, founder of the UBI digital currency and early adopter of cryptocurrencies in Argentina, told the Financial Times that adverse economic conditions have led to a “massive” adoption rate like never before.
Santiago Siri, whose business is supported by Marcos Galperin, founder of MercadoLibre, Latin America’s largest ecommerce platform, said:
“Walking around Buenos Aires is like we went by mistake until 2034, even the builders and taxi drivers are saving in cryptocurrencies”.
According to the company Triple.io, more than 1.4 million Argentines, around 3% of the population, are already in possession of cryptocurrencies.