The Argentine peso has been devaluing rapidly for the second year in a row, with inflation reaching a record 60%. Therefore, local residents are actively saving their savings by investing in crypto.
An April report by Americas Market Intelligence notes that Argentina’s digital currency adoption rate is 12% higher than neighboring countries Brazil and Mexico. They chose bitcoin as the main cryptocurrency for savings. And in second place are stablecoins pegged to the US dollar.
Cryptocurrency is one of the few ways to transfer the Argentine peso into other assets. The government controls the purchase of foreign exchange in order to reduce capital flight. The monthly limit for buying foreign currencies (and cryptocurrencies) is $200 here. But with the help of decentralized exchanges, Argentines have learned to bypass such limits.
Inflation in Ukraine
If Argentines are escaping inflation through crypto, will we see the same in Ukraine?
Now the government is doing a lot to save the economy in a war. Since the dollar is frozen, we do not know the real rate of inflation. But many Ukrainians are already starting to accumulate savings in BTC, ETH and stablecoins.