Argentina has been among the fastest Cryptocurrency engagement countries with the rise in a number of investors, International exchanges, and government Interest since 2018.
It’s down to know that Argentina is walking on the edge of economic crises on account of the Pandemic Hit. The volume of the value of pesos(ARS) has been decreasing day by day with respect to USD and bitcoin.
The country is buried under $65 billion overseas debt with no way of payback. The country declared another default in the debt payment which was due this Wednesday. On 22 April, The Capital, Buenos Aires defaulted on $500 million payments for three overseas bonds, creating speculations about a possible default in mid-May.
The Inflations resulted in Financial Instability and boast the use of Bitcoin
Bitcoin demand in Argentina boosts up when the country is amid consecutive sixth default in the overseas debts. Cryptocurrency research firm Arcane Research revealed on Twitter that Argentines dump a large number of pesos for the purchase of Bitcoin.
According to the report, the demand surges due to the country’s failure to pay the debt of $503 million this month. The Bitcoin demand has risen by 1028% since the start of the year 2018. The increase in Bitcoin volume was soaring around 403% and the USD noticed an increase of 139%.
Restrictions imposed and the backfired result
To stop the downfall of the country ‘s economy, the government started imposing restrictions. Restrictions were set up which banned exchanges in foreign currencies. The aim was to prevent citizens from investing pesos in other currencies. To keep the crypto market which was conquering the citizens low, the government started discouraging its citizens from buying Bitcoin using credit cards.
This restriction did not turn in favor of the country. They were left with an option to jump on the Bitcoin wagon or to die at price. The country’s central bank shook hands with Bitcoin startup IOV labs. The central bank is all set to create a Blockchain system that empowers payment systems that helps the bank streamline its payments, deposits, collections, and other similar processes.
Many South American countries running for Bitcoins
Yes, you heard correct. There are not many south American countries who are running to buy Bitcoins, to invest in them so they can hedge over the economic downfall. The global pandemic COVID-19 empowered the thoughts even more.
People are following the path of US citizens and have started investing in Bitcoin in this time of global crisis. Argentina’s economic drop along with the economic crisis has prompted the individuals to invest in Bitcoin as the maker is unrelated to the conventional market and provides a greater level of safety.
Any measures taken to stabilize the economy can lead to deflation of pesos. According to the statement of CEO of crypto-based lending platform Celsius Network, “A bet on Bitcoin is a bet that the deflationary pressures will win.”
Please Subscribe to CoinPedia for Daily updates on Latest Finance , crypto and technology News and Information direct to your mailbox.