With Peso inflation rates at 276% in the past year, 2.5 million of the 130 million users on top crypto exchanges are Argentinians.
According to Forbes data, Argentina currently has the highest crypto adoption rate compared to every other nation in the Western Hemisphere.
Ever-surging inflation of the local currency, Peso, and complex access to the dollar have been the primary drivers behind the current adoption of crypto assets, primarily USDT.
Argentina Leads Crypto Adoption
A Forbes report highlights that Argentinians are increasingly turning to cryptocurrencies as a hedge against their inflating local currency. The rate of crypto adoption in the country surpasses that of any other in the Western Hemisphere.
According to Forbes, analysis using SimilarWeb indicates that 2.5 million of the 130 million users on the top 55 crypto exchanges are from Argentina. Popular exchanges in the country include Binance, eToro, BingX, HTX, and Bitget.
Chainalysis, a crypto data analytics firm, reported that Argentina leads Latin America in raw transaction volume, reaching approximately $85.4 billion by July 2023. Unlike many other investors who buy crypto assets like Bitcoin primarily for gains, Argentinians typically purchase stablecoins like USDT and synthetic dollars, which have a market value of $112 billion.
The head of Latin America for BitGet exchange, Maximiliano Hinz, recently commented:
“Argentina is an anomalous market where many people buy USDT and don’t leave room for much else. We don’t see this elsewhere. Argentines buy spot tether and don’t do anything with it.”
Inflation Driven Adoption
Forbes says that the current crypto adoption in Argentina results from high inflation, with the Peso inflation rates hitting a cumulative 276% in the past 12 months. Things are so bad that Argentina’s diet is changing from beef to less expensive proteins like chicken and pork. Forbes reports that some forecasters predict steak prices will rise by close to 600% this year.
The weakening currency has led Argentinians to look for alternatives, including buying dollars from black markets, which offer unfair prices, risks of robbery, and fake currencies.
Over recent years, stablecoins have seemed like a perfect escape for Argentinians, owing to their ideal exposure to the dollar and ease of access.
Javier Milei, the new pro-Bitcoin Argentinian president, is open to dollarizing the country. He anticipates that as more competing currencies, including the dollar and crypto assets, are in circulation, people will use the Peso less and less and eventually stop using it.
President Milei stated, “We will go to a dollarization and to the elimination of the central bank so that corrupt politicians will not be able to steal by printing money.”