• Argentina is importing 1,160 pallets of 1,000-peso denomination banknotes from Paris and Malta due to the high demand for new banknotes.
• The persistent inflation in Argentina has caused bitcoin to reach a record high price against the Argentine Peso (ARS).
• Locals are turning to bitcoin as a potential safe haven due to the country’s economic crisis.

Argentina Imports Banknotes Amid Crisis

Argentina’s Casa de la Moneda is struggling to keep up with the central bank’s demand for new banknotes, prompting it to import 1,160 pallets of 1,000-peso denomination banknotes from Paris and Malta. Inflation in the country reached a record 7.7% in March, and the government has so far refused to issue higher denomination bills ahead of a key election.

Citizens Seek Bitcoin as Safe Haven

The persistent inflation in Argentina has caused bitcoin (BTC) to reach a record high price against the Argentine Peso (ARS). Locals are turning towards cryptocurrency, particularly stablecoins, as a potential safe haven with 50% of the population reportedly choosing them over traditional fiat currencies like USD or EUR. The country’s central bank has responded by raising its rate by 300 basis points and restricting access to dollars for certain business payments.

Government Works on Crypto Regulations

As cryptocurrency adoption continues to rise in Argentina, the government has been grappling with regulation and implementing proof-of-solvency procedures for exchanges and custodians as well as requirements and rules for crypto companies. Furthermore, a bill proposed by the Ministry of Economy incentivizes citizens to declare their crypto holdings by offering tax benefits while an Argentine province announced its intention to issue a dollar-backed stablecoin in December 2022.

Bitcoin Futures Index Launched By CNV

Bitcoin’s popularity is also growing in Argentina evidenced by the launch of a bitcoin-based futures index by National Commission of Value (CNV). This product will enable accredited investors to invest in bitcoin with settlement in pesos.

Conclusion

Amidst economic challenges such as high inflation rates and growing debt burden Argentinians have been increasingly drawn towards cryptocurrency investments such as Bitcoin and stablecoins both as investment vehicles but also potentially serving them as safe havens during times of financial tumult such as this one.