The use of stablecoins is experiencing a real boom in Argentina.
A recent study by Chainaloss in Latin America revealed this.
In a long post they published on their official blog on Wednesday, they report data showing that Argentina is on par with Brazil in this perspective, despite having 4.5 times less population.
Argentina situation and stable coin boom
The key to understanding this case is inflation.
Argentina’s annual inflation rate has been above 100% for more than a year, and consistently above 50% for more than three years.
The last time it was below 20% was actually in 2015.
The Chainalysis report states that this situation has prompted Argentines to look for alternatives to their national currency (the peso) and resort to the black market to buy foreign currency, especially the US dollar (USD), to protect themselves. It is emphasized that there are many.
Dollars sold on the Argentine black market are called “brudera” and are not exchanged at the official exchange rate. In fact, it is difficult to buy dollars in Argentina on the official market, so some people decide to explore the world of stablecoins pegged to the US dollar.
Report by Chainalysis
Chainalysis announced that it has investigated the monthly trading volume of the Argentine Peso (ARS) stablecoin on Bitso, a major exchange in Latin America.
This analysis reveals that the monthly exchange value of stablecoins has consistently increased due to the decline in the value of the peso relative to the dollar.
For example, in July 2023, the value of ARS fell below $0.004, and the following month, the stablecoin’s monthly trading volume exceeded $1 million. After falling to $0.002 in December, stablecoin trading volume exceeded $10 million the following month.
During 2024, the monthly trading volume of Peso stablecoins increased again, reaching a peak of over $60 million in March, but then began to decline slightly. Even in June, it was around $50 million a month.
Note that during 2022, this monthly trading volume was close to zero.
Argentina is also the country in Latin America with the highest volume of stablecoins traded as a percentage of total crypto trading volume.
From this perspective, only Brazil (61.8%) exceeded 60%, and Brazil came in second place in this special ranking with 59.8%. The general average was found to be only 44.7%, with Bitcoin in second place at 22.3%. However, in Argentina, the proportion of the volume traded in BTC is below 15%.
It is also the region’s leader in absolute value of cryptocurrencies received, with an estimated $91.1 billion, even surpassing much larger Brazil’s $90.3 billion.
Stablecoin trading in Argentina
One of the most important data points regarding the analysis of this boom in Argentina concerns the average trading volume of stablecoins.
In fact, stablecoin transactions under $10,000 in Argentina are growing at a more sustained pace than any other asset, and according to Chainalysis, this means that Argentines are using stablecoins as a currency to keep up with inflation. This suggests that the government sees this as a means of mitigating the impact of devaluation.
They wrote in their report:
“Their interest in stablecoins is driven by the role of cryptocurrencies in volatile markets and how citizens can better control their economic future by embracing cryptocurrencies, regardless of official monetary policy.” It highlights that.”
latin america
It was found that Latin America accounted for 9.1% of global crypto trading volume from July 2023 to June 2024, with nearly $415 billion received in cryptocurrencies. From this perspective, it even surpasses East Asia, despite having a much smaller population.
It was also found to be the second fastest growing region this year, with a year-on-year growth rate of approximately 42.5%, second only to sub-Saharan Africa.
However, the report notes that in Latin America, the majority of trading volume comes from institutional and professional investors (companies that trade over $10,000), with centralized exchanges (CEX) being the most popular. It emphasizes that it is a certain service.
This also means that the Argentine boom is unique to this country and not common to all other countries in the region.
The report also shows that four of the top 20 countries in the Global Adoption Index are located in Latin America: Brazil (9th), Mexico (13th), Venezuela (14th), and Argentina (15th). We also make clear that we are doing so.
Therefore, Argentina’s unique situation has not only allowed the use of stablecoins to become widespread in the country, but also led to some growth in the crypto sector across Latin America.
