The Argentine Central Bank’s new measures led the peso to lose its value. Those who had invested their money in Bitcoin made a “profit” of 15% in one day.

The new measures that the Argentine Central Bank (BCRA) implemented restrict the purchase and use of foreign currencies. After the announcement, the US dollar traded at up to ARS 145 in the informal market, around 10.7% more than in previous days.

The price of Bitcoin also increased, going from ARS 1,343,000 to ARS 1,549,000 in just two days. In this case, the increase was 15%.

Among its measures, the BCRA decided to take payments in foreign currencies on account of the monthly quota of USD 200 that Argentines can buy.

Apart from that, each time that users purchase US dollars, they will have to pay an additional 35% (as well as 30% of the “solidarity tax” already in force) for the payment of taxes on income and personal property.

According to the BCRA, these measures aim to discourage consumption abroad, purchase of foreign currencies for savings purposes, and exchange operations with bonds (known as the dollar stock market).

Bitcoin as a Store of Value

In countries whose fiat currencies are suffering a rapid devaluation, Bitcoin presents itself as an effective solution to safeguard value. Its predefined issuance of 21 million, its unmovable monetary policy, and its consequent disinflationary trend in the long term make it an ideal instrument for this function.

The advantages of Bitcoin are even above those of the US dollar, which Argentines and other Latin Americans traditionally use to preserve their savings. The US dollar is not exempt from devaluation, having lost more than 90% of its value since 1913.

The current monetary policies of the US government lead many to predict that the purchasing power of the US dollar, which typically falls by around 2% every year, will decline further.

Argentines consider that Bitcoin has the advantage that there are no legal limitations to buy it. People can buy cryptocurrencies with both the local fiat currency and foreign fiat currencies. For that reason, several exchanges advertise their services as a way to “skip restrictions” and be able to dollarize without suffering from state restrictions.

Some Argentine exchanges recently removed the BTC/USD pair from their platforms. However, this is not a consequence of any legal provision but commercial decisions.

Many Do Not Seem To See that Bitcoin Is a Good Store of Value

The information that Google provides indicates that there has recently been a considerable increase in searches for the term “dollar” in Argentina. However, searches for “Bitcoin” in the country have remained low and constant.

A few days ago, the president of NGO Bitcoin Argentina had said that Bitcoin is not the first thing that people normally think of when seeking a safe haven.

In this regard, he gave this example: “If I told someone that an alternative to investing their Argentine pesos is Bitcoin, they would say to me ‘How nice! But I want you to give me US dollars.’” As Andragnes himself stated, “Bitcoin is very efficient, but it requires people to believe in it.”

By Willmen Blanco

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