2013-08-05 Why bitcoins are 60% more expensive in Argentina than the US

[patricktim]

http://www.coindesk.com/why-bitcoins-are-60-more-expensive-in-argentina-than-the-us/

Argentina has experienced turbulent economic times in the past, witnessing a period of severe hyperinflation in 1989, which saw prices rise almost daily and inflation increase to 96.5% in May in the city of Rosario. Unrest in the country culminated in a period of rioting and looting, with the government forced to declare a national state of emergency.

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[vokain]

haha good luck convincing me to trade bitcoins for that trash

[n8rwJeTt8TrrLKPa55eU]

Headline is incorrect and poorly researched.  No one should travel down there with the expectation of making 60% instantly.  

There are exchange controls in place in place in Argentina, which means that USD is only traded freely on a black market, and at a price 60% higher than the quoted government rate, which is used mostly for buying USD from you, not selling to you.  Same story as in Cuba, Venezuela, old Soviet Union, etc., a two-tiered exchange market where what you get at regulated exchange bureaus and banks is just a fraction of the true value on the street.  BTC sellers, obviously, use the black market rate.  Headline could just as easily have claimed that swiss francs or euros trade at a 60% premium too.  Basically all foreign currencies in Argentina trade at a 60% premium when comparing the bogus unobtainable "official" USD rate versus the free market USD rate.

Unfortunately the WSJ is not the only entity doing sloppy journalism these days. Coindesk is usually good but they dropped the ball perpetuating this myth.  BTC prices in Argentina are effectively identical to anywhere else, no one there will buy your BTC for $160+, they will laugh at you like you're some kind of idiot.

[2_Thumbs_Up]

The article adresses that though (and it seems like they changed the headline).

In Argentina, a bitcoin costs around 921.48 pesos (ARS), which is equivalent to $166.97 if you use the Argentine government’s exchange rate of 5.5 ARS to the dollar or $115.23 if using the black market or ‘blue dollar’ rate of around 8 ARS to the dollar.

So they still pay a mark-up of about 10 USD.

[sergio]

I think most of the price difference is due to the black market dollar, and the small markup of around $10 is due to the same reasons that btc-e and mtgox have different prices for bitcoin, and the people selling on the street want to make a profit.

[Hfleer]

I think most of the price difference is due to the black market dollar, and the small markup of around $10 is due to the same reasons that btc-e and mtgox have different prices for bitcoin, and the people selling on the street want to make a profit.

Yea looks like it, buying black market will mostly have a markup.