According to a new report from blockchain analytics firm Chainalysis, the number of people in Argentina that are turning to cryptocurrency for financial lifelines is rising as the country grapples with high inflation and economic instability.
Stablecoins now make up 61.8% of all crypto transactions within the nation, making it one of the largest adopters in Latin America, only behind Colombia at 66% and ahead of Brazil’s 59.8%.
That represents a direct increase that coincides with the continued devaluation of the Argentine peso as nationals flock to dollar-pegged digital assets as a means of preserving wealth.
In a year that saw inflation rise as high as 236.7% through August and more than half of its population living in poverty, Argentines are running to cryptocurrency as a hedge against economic uncertainty.
“The correlation between peso devaluation and a spike in stablecoin trading on exchanges really indicates how crypto is used as a financial hedge in turbulent markets,” said a Chainalysis researcher. “That speaks, in many ways, to an ability of citizens to make independent choices about their financial futures, free from any force of official monetary policies.”
This is not only an Argentine trend, as Venezuela’s tendencies in fighting hyperinflation are moving in the same direction. According to this report, Venezuela has garnered the top spot in the region for digital assets received or bought on centralized exchanges, reflecting a wider regional pivot toward digital assets driven by economic woes.
This wave of crypto adoption comes at a time when Argentina is in transition under the administration of newly elected President Javier Milei, a libertarian economist who has expressed interest in Bitcoin and pledged to fix the financial issues afflicting the country.
