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Argentinian inflation figures were revealed last week, with the annual Consumer Price Index (CPI) hitting record highs reaching 78.5%. This puts the country second only to Venezuela in Latam in terms of high inflation, with prices rising almost 8% during August, hitting Argentines’ pockets. ONEaccording to a survey from Bitso, this has prompted Argentines to explore cryptocurrencies as a way to keep their purchasing power via stablecoins.
Inflation is becoming a major problem for some countries in Latam whose economies have been hit by the current economic downturn. Argentina, one of the largest economies in the area, is now facing rampant inflation levels that are affecting its citizens’ pockets. The latest CPI report revealed that prices rose by 7% MoM (month-over-month), with these numbers second only to Venezuela’s inflation, which has reached well over 100% YoY (year-over-year).
The prices of food and drink rose 7.1% in August, while other goods marked a stronger increase, such as clothing and white goods. Cumulative inflation figures reached 78.5%, the highest since 1991 amid a climate of economic and political uncertainty, and the country has three finance ministers in less than three months. The Argentine peso is one of the fiat currencies that has suffered the most in Latam, losing more than 25% against the dollar when considering the official rate, and almost 50% of its value taking the unofficial “blue” exchange rates as a reference.
The poor performance of the Argentine economy has prompted citizens to explore alternative ways to maintain purchasing power against inflation, and to consider cryptocurrencies and stablecoins even amid the current negative price trend. While Argentina is no longer among the top 10 countries with the most cryptocurrency adoption, according to Chainalysis, local studies confirm that adoption continues to grow.
A recent survey conducted by Bitso, a Mexico-based cryptocurrency exchange, indicated that there is a high level of awareness regarding cryptocurrency assets in Argentina. The survey found that 83% know about cryptocurrencies, and almost 34% have specific knowledge about these tools.
Additionally, of the 83% who are aware of cryptocurrencies, 10% already or currently have cryptocurrency assets as part of their investment portfolio, while nearly 23% want to have them in the future. The focus of these investors in owning crypto is to use it as they would use fiat currencies, and to maintain their savings even with these inflationary numbers.
What do you think about the latest inflation numbers in Argentina and the popularity of crypto? Tell us in the comments section below.
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