Crypto: USD Stablecoin Premiums Surge In Argentina As Economy Minister Resigns

Crypto News – The abrupt resignation of Martin Guzman, Argentina’s Economy Minister, caused the price of dollar-pegged stablecoins to spike across exchanges on Saturday. 

iexclusivenews reports that Argentina has one of the highest rates of crypto adoption in the world.

This online news outlet understands that a faltering economy already dealing with high inflation. And a weakening national currency now faces further instability as a result of the minister’s shocking resignation. Which was announced on July 3 via a seven-page letter posted on his Twitter account.

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Data from Criptoya shows,The price to purchase Tether (USDT) using Argentine pesos (ARS) is currently 271.4 ARS through the Binance exchange.

This price is approximately 12% higher than it was before the resignation announcement and 116.25 percent higher than the current fiat exchange rate of USD/ARS.

Similar increases have been noted in other USD-pegged stablecoins. Such as Dai (DAI), Binance USD (BUSD), Pax Dollar (USDP). And Dollar on Chain, according to a local cryptocurrency price tracking website (DOC).

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What You Need To Know

Argentineans are investing heavily in cryptocurrencies as a way to protect themselves against rising inflation in their nation and further depreciation of the peso against the US currency.

iexclusivenews reports that in 2016, before inflation had a significant impact. One USD could only buy about 14.72 Argentine pesos. Six years later, though, one USD can purchase up to 125.5 ARS.

A law known as Decree No. 609/2019, which was implemented on September 1, 2019. Has made it nearly impossible for Argentinians to exchange more than $200 in US dollars each month. At the official exchange rate, leading to the additional premium on US-dollar pegged stablecoins.

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It was implemented to stop the Argentine peso from plummeting precipitously in the face of a faltering economy.

According to Trading Economics, the annual inflation rate in Argentina increased for the fourth consecutive month in May, reaching 60.7 percent.

Argentineans are expected to use or own cryptocurrency at a rate of about 21% by 2021, according to Statista. Giving the South American country the sixth-highest adoption rate internationally.

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Meanwhile, iexclusivenews Nigeria understands that according to a Cointelegraph report in May.

Argentina’s “crypto penetration” had increased to 12%, which is twice the rate of Peru, Mexico, and other countries in the region.

This growth was primarily the result of residents looking for a haven from rising inflation.

In addition to Bitcoin, Argentineans are increasingly using stablecoins as a way to store value in the US dollar.