Since March 16th, LocalBitcoin has registered an increase in the volume of crypto-exchanges in the Latin American country.
During the second week of May, the renowned crypto exchange platform LocalBitcoin experienced a considerable increase in the volume of Bitcoin (BTC), this increase led to register a record in Argentina.
According to data that the renowned P2P platform shared, between May 4th to 10th, it was possible to register a volume of BTC exchange for an approximate value of USD 571,942, a figure that represents the largest number of movements that LocalBitcoin carries out in the South American country.
Matt Ahlborg, Crypto Expert Analysts, invested this new record. He concluded that there is not a very notable increase compared to the number that the platform register in the rest of the world. However, he stressed that there was a significant increase registered in LocalBitcoin Argentina and that this could be the result of the recent exchange control the country approved last March.
In addition to the exchange control, Ahlborg considers that the beginning of the quarantine for the Covid-19 pandemic, during March, could be another factor that must be considered for this increase.
According to a graph that shows the volume of exchanges conducted during March, it is evident that the increase has been progressively escalating over the weeks. For instance, the week of March 16th to 22nd, LocalBitcoin recorded exchanges worth USD 214,872; whilst the following week, from March 23rd to 29th, the number of exchanges rebounded, reaching an increase of 104%, with a volume of USD 438,573 in exchanges using BTC.
This considerable increase in the volume of cryptocurrency exchange suggests that the industry is experiencing new levels of adoption in Latin America. Some experts consider this fact as an economic relief method since Argentina has faced a deep economic crisis that has led its citizens to experience new ways to save and invest their money. Cryptocurrencies could be their best option.
The Adoption of Bitcoin in Argentina
Argentina represents the third-largest economy in Latin America. According to Ahlborg, the country’s livelihood is based mainly on the export of agricultural products. It also maintains a strong industrial sector that helps sustain the best levels of the middle class in South America.
However, Ahlborg considers that the political situation has produced a high level of instability, developing complex economic problems such as hyperinflation, among others. This whole scenario can be another fundamental factor for citizens to look for different alternatives to have savings and avoid using the local currency.
The researcher adds that, although the exchange of cryptocurrencies is a viable option to maintain savings in Argentine citizens, many prefer to have savings in dollars. For this reason, Argentines have different ways of obtaining the US currency in cash and have their savings on hand. Therefore, cryptos compete directly with the US dollar in Argentina.
Although Argentines prefer to use the dollar to maintain their savings, lately the price of it in the exchange markets has experienced a substantial increase. Thus, a devaluation of the local currency and the increase in the price of the dollar may be pushing citizens to look for different alternatives. Ahlborg considers that this may be one of the main reasons for the consequent increase in the exchange volume at LocalBitcoin.
By María Rodríguez