Argentinians are increasingly hoarding USDT in a bid to safeguard the value of their savings and fight hyperinflation, a new report has claimed.
Per Forbes, Argentines are becoming ever more crypto-keen. But the report claimed they “aren’t playing the meme coins lottery or trying to get rich off the next token that is on the cusp of taking off.” Instead, it claimed, they “typically buy and hold USDT.”
Hoarding USDT: Argentina Turns to Stablecoins
The media outlet quoted Maximiliano Hinz, the head of Latin America operations at the crypto exchange Bitget as stating:
“Argentina is an anomalous market where a lot of people buy USDT and it doesn’t go any further [than that]. We don’t see this anywhere else. Argentines buy Tether in cash and leave it [in their wallets]. They don’t do anything with it.”
A Forbes analysis has found that Argentina, with a 276% inflation rate, has the highest crypto adoption rate in the Western Hemisphere. But, use of trustworthy exchanges isn't so high.https://t.co/ChH9a6yI9B (edited) pic.twitter.com/9SjdXDdcWD
— Forbes (@Forbes) July 8, 2024
In other parts of the world, traders often use USDT to buy other coins, including Bitcoin (BTC).
However, experts agreed that Argentina-based “don’t typically use USDT to speculate by trading it or swapping it for other types of cryptocurrency.”
The government has previously set caps on foreign currency buying as hyperinflation continues to dog the Argentinian economy.
As such, USDT seems to many to be the “perfect escape from Argentina’s inflationary woes,” the media outlet wrote.
#HankeInflationDashboard: This week’s top 5 inflators:1.Zimbabwe (562%/yr)2.Sudan (253%/yr)3.South Sudan (226%/yr)4.Argentina (198%/yr)5.Nigeria (104%/yr) pic.twitter.com/hUwE49tdTi
— Steve Hanke (@steve_hanke) July 8, 2024
But, it warned, USDT buying “comes with its own set of risks,” as Buenos Aires still “hasn’t created any regulations to control this wild industry.”
Stablecoins pegged to the United States dollar “are consistent with the concept” of dollarization, the media outlet remarked.
Bitcoin-keen President Javier Milei hopes to dollarize the Argentine economy and do away with the fiat peso.
But despite recent regulatory moves, Argentina still “does not provide significant regulations or safeguards for cryptocurrency users,” the report’s author wrote.
Chainalysis data has previously shown that Argentina “leads Latin America in gross crypto transaction volume,” with an “estimated $85.4 billion processed through July 2023.”
Argentines are also keen customers of some of the world’s biggest crypto exchanges, the media outlet noted.
Per SimilarWeb data, “out of 130 million visitors to 55 of the world’s largest crypto platforms, 2.5 million came from Argentina.”