Argentina has re-imposed capital controls, restricting the liberty of foreign currency purchases for people and companies.
As revealed by Bloomberg on Sep. 1, the increasingly distressed South American country took the leap as the Argentine peso (ARS) is suffering massive losses against significant fiat currencies like the US dollar.
Argentina places a dollar entry threshold of $10K In latest moments, Argentina has shown a Bitcoin (BTC) affinity, with trade amounts increasing as economic uncertainty rose. A discount emerged on the cryptocurrency markets of the country last month. Now, for people seeking to put ARS on the market, access to difficult currency is limited to just $10,000, despite its exchange level dropping 34% in USD terms since Aug. 2. Therefore, demand for Bitcoin, an uncontrollable cross-border asset, should rise further, according to speculators.
“Buy Bitcoin,” tweeted attorney Preston Byrne, focused on cryptocurrency following the news. Volume data showed Argentinians trading more in ARS last week on P2P crypto exchange Localbitcoins, a trend that could persist if conditions meet those of Venezuela embattled. The financial woes of Argentina may not match those of Venezuela, but proponents of Bitcoin appeared to preempt the crisis months earlier.
Billionaire investor Tim Draper even met previously this year with the country’s chairman to bet on ARS outperforming Bitcoin. He asked Argentina to shun the peso completely if Draper were to be victorious, embracing Bitcoin as its new formal state currency. “That would be an ideal choice because there is a lack of trust in this coin,” he said at the moment of the March conference.