According to expert economists, allowing the use of cryptocurrencies could attack the economic crisis that Argentina is going through
According to a recent press report, it was announced last Friday, March 29th, that a meeting was held between the General Manager of Huobi, a company dedicated to crypto exchanges, together with important Argentine government officials, during a visit to China, to discuss important economic affairs.
According to the report, the meeting was dealt with valuable purposes to study the possibility of the definitive adoption of blockchain technology and cryptocurrencies.
Felix Martin Soto, Vice Minister of Finance of Argentina, who also attended the meeting, said it was planned to address issues related to blockchain technology as a mechanism to promote financial inclusion of citizens in this sector and reduce government costs.
By going deeper into this point, Soto said that a large part of the citizens does not have any bank accounts, and they do not conduct most of their commercial transactions with the local currency because they invest their money in saving in foreign currency, increasing the demand for American dollars. For this reason, he assured that presenting citizens with another investment option could relieve the high request of USD, as well as boost the industrial sector and offer a safe option as a payment method.
In recent years, Argentina has faced a persistent economic crisis that has led a large part of Argentines to lose their jobs, decrease their quality of life and lose significant savings. This is due, according to experts, to what the Argentine businessman, Marcelo Diamand, explained almost 50 years ago, about the imbalance of the industrial structure of the country.
He explained that consuming more USD than the one produced by the commercial sector generates a monetary vacuum. What is summarized is that the deficit increases inflation and, thus, raises production costs, causing price increases, falling value of the currency, among other factors.
Soto said he was confident that the eventual adoption of the crypto market in the country will boost the local market balance and attract an important commercial sector which seeks to break through in the conventional industry using blockchain technology and cryptocurrencies as an investment fund. Some expert economists see it as a possible positive measure to attack inflation and decrease the demand for US dollars.
Regarding the growth of the Huobi Company, Soto mentioned that its platform could position the Argentine industry to large foreign investors, and would introduce the country to the map of digital assets.
“We would like to learn how to participate in Huobi’s cryptocurrency and blockchain industry (…) Through tokenization on the Huobi platform, for example, Argentina’s abundant agricultural, mineral and energy resources could be well financed by global investors”, he explained.
This is not the only step that the Argentine government has suggested to blockchain technology. A few weeks ago, Mauricio Macri, President of Argentina, held a meeting with crypto entrepreneur Tim Draper. The businessman suggested the latest legalization of Bitcoin (BTC) to said head of state, as a measure that, according to him, would attack high inflation rates; it would stop the devaluation of the Argentine peso and prevent the migration of qualified labor.
By María Victoria Rodríguez