"Dollar 대신 Bitcoin"... Economic Crisis Sparks Cryptocurrency Craze in Argentina

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Argentinian citizens are increasing their investments in cryptocurrencies, following the rising trend of Bitcoin prices. It is interpreted that Bitcoin has emerged as an alternative investment to the dollar for people exhausted by severe economic hardship and inflation.

According to a Bloomberg report on the 19th (local time), Bitcoin trading volume at 'Lemon,' a major cryptocurrency exchange in Argentina, approached the highest weekly level in 20 months. In particular, Bitcoin trading volume in the second week of March recorded about 35,000 transactions, doubling the weekly average of last year. Similar situations were reported at other major Argentinian exchanges such as 'Ripio' and 'Belo.'

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The report diagnosed that this Bitcoin craze is due to the diminished appeal of dollar investments among Argentinians. Javier Milei's government in Argentina is focusing on managing the peso exchange rate against the dollar to recover the economy. Accordingly, the peso exchange rate showed a 10% appreciation against the dollar in January and February. However, during the same period, Bitcoin surged nearly 60% against the dollar, changing the investment flow that had been converting pesos into dollars for reserves.

As Bitcoin investment spreads, related criminal damages are also increasing. Last month, cryptocurrency-related fraud cases in Argentina increased fivefold, according to the NGO 'Bitcoin Argentina,' cited by the report. Gabriela Batiato, the legal officer of Bitcoin Argentina, said, "The desperation of Argentinian citizens leads them to make hasty decisions without fully considering the risks," adding, "This means they become easy prey for scammers."

Meanwhile, the Milei government is pushing policies to strengthen virtual asset regulations. The Argentine Securities and Exchange Commission (CNV) explained in a press release, "We have established regulations related to the Virtual Asset Service Provider Registry (PSAV)," adding, "This is a follow-up procedure in accordance with amendments to laws preventing money laundering, terrorist financing, and the proliferation of weapons of mass destruction."

CNV also stated, "The purpose of PSAV is to manage appropriate, accurate, and up-to-date information on all individuals and entities participating in virtual asset transactions," and added, "PSAV will have supervisory, regulatory, inspection, and sanctioning authority over virtual asset service providers."

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