In Argentina, a small but steadily growing group of entrepreneurs and individuals use digital currency Bitcoin for financial transactions outside the established banking system, reports the “New York Times Magazine” and the “Financial Times”. For the Bitcoin users it is also important to bring in a heavily regulated economy the most of their money.
Argentina is celebrated in the Bitcoin scene repeatedly as a model country of ascension. 2014 declared the “Bitcoin Market Potential Index” that digital currency in Argentina have the greatest potential for rapid spread. The reasons for this can be found among others in the country’s economy. The government of Cristina Fernandez de Kirchner is pursuing a strict monetary policy, the country suffers from inflation rates of 20 to 30 percent. The government is relying on capital controls. The access to foreign currencies is closely regulated, economic stagnation of everyday life.
Because the Argentine Peso is still extremely volatile, the exchange is very attractive in stable currencies like the US Dollar for Argentines. The exchange between the Peso and the Dollar happens often on the black market, because the official and unofficial exchange rates drifting extremely far apart. While you currently receive through official channels for a Dollar nine Pesos, there are the “Cuevas”, the exchange offices, about 14 Pesos. The purchase through official channels is also limited.
When Argentines now receive payments from abroad on the regulated bank chain, which means not just paperwork and waiting time, the foreign currency is also the official – the equivalent price in Pesos – so low. That rankles the Argentines, because they would replace the money in the street, they remain much more. At this point Bitcoins come into play: If payments made with the digital units of money, fall away not only logistical constraints, it is happening on an efficient way, the strict boundaries around foreign currencies to circumnavigate effectively.
Already several companies in the country are specialize in trade with the crypto money. BitPagos example assumes for Argentine companies, the processing of international credit and Bitcoin payments. The sedentary in San Francisco in the US, the company takes money from customers contrary, so buying Bitcoins and outputs it to the entrepreneurs. The crypto money in turn can be used for other financial transaction or be traded on the black market at a better rate in Pesos or Dollars. With good price, customers save thus up to one third.
According to the “FT” the Bitcoin use in Argentina has doubled in the last year. Particularly noteworthy is the fact it is seen that the crypto money is also used by individuals for “normal” financial transactions, what’s on the rest of the world rather the exception. In small steps Bitcoin penetrates slowly in the Argentine daily one, for example, allows the online mail order company Avalancha payments with Bitcoin, since May have the Argentines with Bitex.la access to a real-time Bitcoin Exchange.
The actual size of the Argentine Bitcoin scene is difficult to measure. The “FT” speaks about 6000-8000 registered users and Argentina Bitcoin Foundation estimates that 15,000 to 20,000 people have the crypto money. With a population of 41 million that is still vanishingly small numbers. That the abstract and complex concept of Bitcoin use in Argentina many people deters, in addition may inhibit the spread of insecurity.