Bitcoin Forum

Shifting politics, economic uncertainty, and stricter forex controls have led Argentine banks to eliminate trading desk jobs.

https://bitcoinist.com/bitcoin-price-breaks-12k-on-argentinian-crypto-exchange/

It was expected to be completely honest, they are going through a lot of economic issues and when that happens bitcoin is seen as a safe haven.

The worst part about is it, is unlike countries like Venezuela, the government is actually restricting their access to using their funds and have established some policies to stop this from happening.

Does anyone know why Argentina's don't just VPN and get cheaper prices on other big exchanges? I've never really understood the concept of prices being pumped on different exchanges.

There would be be any other options if they are going to be strict to foreign exchange, cryptocurrency would be their next option. Probably even the best option before going for USD for an Argentinian with lots to lose in times like this. Must be worth for the localbitcoin user to dump his coins to anyone for $11K. Looks like South American countries are up to revolutionize cryptocurrencies, they're on the right track.  :)

I wonder this news what will happen bitcoin price reach $11.6k in argentinian crypto exchange, anyways I think this good for the argentinian bitcoin hodlers but the question here is what is the impact of this in the whole crypto is obvious there have manipulation. 

This is a fine time for Argentinians to protect their assets, but a better time would be been since either early August when the writing on the wall became clear or, even more so, any time over the last few years.

I'm happy to see people finally acknowledge the pressing need for something like Bitcoin even though it's still very niche overall, but with time I'm sure Bitcoin will grown on people there.

It's not easy for people to shift to an asset they have no prior experience with, and more importantly, jumps up and down like a penny stock. It will probably take a decade for people to become truly comfortable with Bitcoin.

This applies to every shaky country going through similar problems.... people always tend to wait for the last moment to seek for safer assets, no matter how many times they have gone through it before.

This will further promote Bitcoin and cryptocurrency trading among Argentinian traders. Traders who are formally employed by trading companies will most likely shift into individual and home-based trading. And since stocks are severely affected by the economic turmoil in the country and forex is also being made monitored very strictly, they are left with no other better option than crypto or Bitcoin trading. This is why the rise of the price of Bitcoin in Argentina is faster.

People who are interested to acquire Bitcoin in  Argentina have to pay a higher or premium price just to have them all because of the increasing demand caused by the many perennial problems affecting the country's economy. There remains no solid solutions in sight for the myriad challenges faced by this country so we can expect that Bitcoin will be commanding a good price in this region, higher than what other countries are enjoying.

I don't know if I should be sad or happy with this development. I am sad because I know how harsh realities can severely be affecting families all over that country. I belong to a developing country though our national leadership are not as careless as those in Argentina. Maybe I could at the same time be happy because here we can see how Bitcoin can be helping a number of people survive this conflagration affecting them.

So aside from Venezuela and Zimbabwe, Argentina is now also becoming another "poster child" for Bitcoin and cryptocurrency.

Argentina's yearly inflation reaches 50%, the government’s debt burden $57 billion to IMF is the worst mistake, the debt-interest will drag the country down into the ruin.
While they have to buy bitcoin at a higher price, it may be a double-edged sword if the price suddenly drops, unless their intention is to escape the inflation, yes it's better to switch-over rather than keep fiat currency. If the country is going to fall into a crisis, citizens may have to leave the country like in Venezuela.

With little financial resources you can get the price in Argentina to break the $20,000 all time high in a minute. Thin orderbooks and massive spreads are the cause of these premiums, nothing else, premiums that market makers happily exploit; they let you sell into their low buy order, and let others buy these coins much higher up. Very common tactic in any illiquid market.

Premiums only mean something with thick orderbooks and very tight spreads. That's indicative of demand. This $11,600 jump in Argentina laughable.

if the premium were sustained across all exchanges, it would be notable. according to the article, only one of the exchanges has this massive premium:


that usually indicates problems with the exchange, not increasing nationwide demand. the largest argentinian exchange isn't even listed on CMC so i have no basis for comparison.

if ripio customers aren't experiencing fiat withdrawal delays, i would guess this was just a temporary spike due to lack of liquidity.

Just as laughable as the flood of news coverage we have seen this year about booming adoption in countries such as Venezuela.... it's the same bull narrative we keep reading about over and over again.

Are there people using Bitcoin and other crypto currency to some lower degree, it seems like that, but most definitely not in the order news outlets want to make you believe.

It's what everyone wants to read, but it has to be based on facts, not on assumptions and hopes. I prefer honest news coverage, even when it's not bullish.... no one here gains any benefit from fake news.

you'll never get much in the way of definitive 2nd hand evidence in places with monetary/economic turmoil, because almost everyone who is using cryptocurrencies is doing so to skirt restrictions i.e. they're breaking the law. But just like people using cigarettes in prison for currency, there is simultaneously a code of silence (because nearly everyone participates) and a widespread knowledge that the unspeakable is the abiding culture.

rich people in Venezuela, Argentina, Turkey, Chile, China and other countries with capital controls (or simply with failing local currencies) are not all well connected enough to get money in and out of the country in the volumes they want to. But of course, they find a way, and we cannot reasonably expect them to present the evidence to the world, yet we can surmise that it is very likely exactly what's going on.

Maybe the rumor that people use Bitcoin to transact internationally when banks won't do it is just a smokescreen, just to send investigations in the wrong direction to hide the way people really do international money transfers? Or maybe that's a double bluff? When it comes to clandestine activity, all evidence is circumstantial, indirect or anecdotal, and possibly a strategic rumor to disguise the truth.

The article omits a fact which is crucial for that jump. At the beginning of November, a new restriction took place in Argentina, which requires now Central Bank approval when buying "crypto-actives" (the Spanish word is "criptoactivos") at foreign exchanges using debit or credit cards (I put some words in italics because it does not affect local crypto exchanges at all).

Until last week, Argentinies have already bought Bitcoin and other cryptos with this mechanism, using Coinbase and other exchangers which allowed credit card purchases. Many of them later changed their BTC into dollars, to circunvent restrictions the article mentions (it's not possible to buy more than $200 per month on the local forex market). Now, what they have to do is to buy the BTC at a local exchange, which resulted in a much higher demand on these sites.

Argentine local exchangers have generally a relatively low volume. Now, all the demand that before got into the foreing exchanges, went into local exchanges. That's the reason for the price increase.

Now the increase could lead into a market situation where it becomes attractive for Argentine Bitcoin holders (which bought them before the restrictions) to sell their BTC on the local market because of the premium. This could drive the (BTC/ARS) price down again, but will only happen if people do not believe that the Argentine Peso will lose more value. Currently the USD/ARS exchange rate is pretty stable, though, so I expect exactly that to happen.

On a side note: I suspect that Argentines contributed to the last two "intermediate Bitcoin rallies" that led us to prices above $10K for a short time. These two rallies took place exactly on days after new forex restrictions were put in place in Argentina (mid-August and the end of October). In both cases, people would have used their credit cards to buy Bitcoin to transform them into US dollars later, so the local exchanges don't show a massive volume increase. This could have "dried up" the supply and thus made the price jump.

This is a very real fact, no doubt predicted that the Bitcoin market in Argentina has a very positive value when measured globally, this will have an impact on Bitcoin being an alternative to protect the peso currency which continues to inflation.

The reality is that in Argentina buyers, storage or delivery of Bitcoin is very easy transactions of each bank with technology automatically, anyway for now the Argentine government itself cannot limit every Bitcoin transaction.

With this incident I think the economy in the country of Argentina is a bit experienced and is in a positive condition.

Because, Argentinians, like most other people in most other countries, have to buy in their own currency, not with US dollars. They couldn't buy outside if they wanted to, and almost no exchange outside or banks outside these days would accept their currency -- not without a huge huge penalty, due to hyperinflation.

So those prices you see, that's the seller trying to price in hyperinflation.

Argentinians, in fact, did that for a long time - according to what I read, they bought mostly on Coinbase, using credit cards. The Pesos were exchanged to dollars by the banks inside the Argentine forex market (like it usually happens when you buy something outside your country with debit/credit card), so these buys contributed to capital flight. As the local forex market is influenced by Central Bank policy which tries to keep the Peso up, the exchange rate tends to be undervalued (on the unofficial (there are legal and illegal exchange variants) forex market the Peso price is about 10-20% lower, depending on the day).

Now, from the start of November, the government has restricted that practice (they need Central Bank approval to buy on international sites, but that approval is not very likely). So now they have to buy BTC on local markets. The problem is that there are few Bitcoins on these exchanges, so demand grows and drives the local BTC price to crazy amounts.

There are a couple of countries where Argentine pesos are accepted - mostly the neighbors, like Uruguay. The premium is however substantial, like you assumed (see here (https://www.brou.com.uy/cotizaciones) for an example of the extremely high buy-sell spread).

Or there are capital controls or similar restrictions. There was a point during which on all Chinese exchanges, and later on all Korean exchanges Bitcoin traded at a significant premium because of how hard it is/was to transfer fiat money between them and other countries.

Even if it hit 12,759$ (based on the article) there is really no reason why we have to be surprised on such price discrepancy compared to the global market we have. We all know the price is affected by hyperinflation or at least is just a spike on those exchange, there was really no information about the trading volume that day or for how long BTC stayed in that price so we cannot really confirm that Argentina has that big of a price gap compared to what we have.

Its actually something that give me some delight but I am not really thrilled by it until the increase is circulated to the entire world and I begin to see some increase in the value of my asset without being a citizen of Argentina. What is currently happening in Argentina is going to be temporary as I see the country's economic managers standing up to the challenge of ensuring that the trend is curtailed not really about the effect it will have on the common man on the street but because it means them consolidating their power which they will lose the moment people start to lose trust the fiat economy that they have created.

I don't understand this. Is it that difficult to travel to Uruguay or Chile, and exchange your Argentine Peso banknotes to Bitcoin? I know that is it not viable for small amounts. But in case you are purchasing 1 BTC or higher amounts, then what is the point in paying 20% to 30% extra? BTW, I am not sure about the exchange rates in Uruguay and Chile. I assumed that they'll be near the global rates.

I'm pretty sure that most people buying larger amounts have other routes of acquiring Bitcoin with lesser premiums. On top of that, the liquidity in Chile is quite poor as well, so I'm not sure how much benefit there is in traveling to that country. Uruguay I assume is way worse in terms of liquidity so that's not going to provide any help at all.

https://coin.dance/volume/localbitcoins/ARS
https://coin.dance/volume/localbitcoins/CLP

Bitcoin is so scarce that there just aren't that many coins circulating in that region. It will only become more of a problem as the block halving will soon cut the inflation rate in half, which means that coins become even more scarce and thus more expensive.

sure.

ask yourself though: would you, Vishnu, like to buy some Argentinian currency? Wanna exchange it for some BTC? No? Well why would a typical BTC holder in Montevideo or Santiago feel any differently. They likely don't want USD or EUR either, so selling BTC for ARS is nothing short of suicide.