Argentina's President-Elect Milei's Election Boosts Crypto Adoption, Stablecoins Eyed as Future
Summary:
Argentina's President-elect Javier Milei's pledge for significant economic reforms has positively impacted the country's crypto community. The cryptocurrency exchange, Ripio, witnessed a surge in new users and increased trading in its USD-pegged stablecoin, UXD. Stablecoins are expected to play a crucial role in Argentina's financial landscape, irrespective of Milei's decision to completely dollarize the economy, due to challenges in accessing banknotes and bank dollars. Annual inflation in Argentina reached 143% in October, ranking the country 15th in the Chainalysis Global Adoption Index.
Javier Milei, Argentina's President-elect, secured his position based on pledges for substantial economic reforms. The nature of these changes will be revealed only after he assumes office on December 10th, however, stablecoins are expected to maintain an integral role in the financial ecosystem of Argentina, according to Sebastián Serrano, CEO of Ripio, as he related to Cointelegraph en Español.
The election of the former economics lecturer has been well-received by the Argentine cryptocurrency circles, shared Serrano. Ripio, a cryptocurrency exchange headquartered in Argentina, observed an uptick of 180% in fresh user registrations in October and a week-on-week surge of 110% for new users on the 19th of November, the day when the runoff elections paved Milei's way to presidency.
This heightened interest was mirrored in the trading activities involving the US dollar-pegged UXD stablecoin, a creation of Ripio. On the weekend of November 17-18, the UXD deviated from its peg and soared to a notable high of $5.03, as recorded by CoinGecko.
Stablecoins already serve an essential function in the financial operations of Argentinians, and this significance might possibly increase in the future, irrespective of Milei's decision to completely dollarize the economy. Serrano voiced, "In the wake of challenges to access both banknotes and bank dollars, stablecoins have evolved into a necessary tool for numerous businesses and individuals. [...] If we steer towards dollarization or bi-monetarism, yet with restricted access to dollars, stablecoins will undoubtedly continue to gain traction."
Serrano believes that Argentina's Central Bank should be restructured or replaced by a similar entity, instead of being abolished as Milei has proposed. In the absence of a central organ, the monetary flow could be excessively disorganized, as Argentina has witnessed earlier. This is another primary rationale for the increasing usage of stablecoins in Argentina and other nations in Latin America.
Argentina experienced a yearly inflation rate of 143% in October. It secures the 15th position in the Chainalysis Global Adoption Index.
Published At
11/23/2023 7:35:00 PM
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