Argentina Surpasses Brazil as Latin America’s Leading Crypto Market by User Inflows

Argentina has emerged as the top cryptocurrency market in Latin America, surpassing Brazil in estimated crypto inflows between July 2023 and June 2024.

According to a report by Chainalysis published on October 9, Argentina’s crypto users deposited a total of $91 billion during this period, edging out Brazil’s $90 billion in total inflows.

The rapid adoption of cryptocurrency in Argentina is closely tied to the country’s ongoing struggle with inflation and the devaluation of its national currency.

Argentinians Turn to Crypto Amid Surging Inflation

Facing an unstable economic environment, many Argentinians have turned to alternative financial options like the US dollar and dollar-pegged stablecoins to preserve their wealth.

The trend has contributed significantly to Argentina’s rise in the crypto market, making it a leading player in the region.

Chainalysis highlighted that Argentina’s stablecoin market is among the largest in the world by transaction share.

Between July 2023 and June 2024, 61.8% of Argentina’s crypto transactions involved stablecoins, compared to Brazil’s 59.8%.

This is well above the global average of 44.7% but slightly below Colombia’s 66%.

The high volume of stablecoin transactions in Argentina indicates a strong preference for these digital assets, offering a hedge against local currency volatility.

In our next 2024 Geography of Crypto Report preview chapter, we look at crypto adoption in Latin America. Read to learn more about crypto markets in Brazil, Argentina, Venezuela & the Caribbean. Featuring insights from @circle @BTGPactual @AaronWStanley: https://t.co/sPVXseFsuf pic.twitter.com/g0w9M7cvqy

— Chainalysis (@chainalysis) October 9, 2024

Notably, the report pointed out a rise in retail-sized stablecoin transactions in Argentina—those under $10,000.

This suggests that everyday Argentinians are increasingly turning to stablecoins to safeguard their finances from the impacts of inflation.

“Their interest in stablecoins highlights the role of crypto in unstable markets and how citizens are able to take better control of their financial futures by embracing cryptocurrency, regardless of official monetary policy.”

The growing demand for stablecoins in Argentina has attracted the attention of major players in the crypto space, including Tether, the issuer of the world’s largest US dollar-pegged stablecoin, USDT.

Tether has prioritized markets like Argentina, recognizing the need for a “digital dollar” in regions where economic stability is uncertain.

Tether’s CEO, Paolo Ardoino, emphasized this focus, stating, “That people want to hold that dollar, not in cash, but in a digital form because it’s much more convenient.”

Argentina Seeks to Position Itself as Crypto-Friendly Nation

Argentina has also made strides in positioning itself as a crypto-friendly nation.

In late 2023, the country allowed the use of Bitcoin in legally binding contracts, following the election of pro-Bitcoin President Javier Milei.

However, despite its growing crypto activity, Argentina’s regulatory framework for digital assets remains underdeveloped.

As of July 2024, the government has struggled to introduce formal regulations for the cryptocurrency market.

Unlike regions like Europe, which have actively pushed for stablecoin regulations, Argentina has yet to establish a comprehensive framework for these digital assets.

In August, the Ministry of Education of the City of Buenos Aires partnered with the ETH Kipu Foundation to introduce Ethereum and blockchain technology into the high school curriculum.

The initiative aims to equip students with the skills necessary to thrive in the emerging tech economy.

In addition to the in-school programs, the partnership includes the development of an online Solidity course, a programming language used to develop Ethereum applications.