Argentine Pesos Crypto Trading Soars by 400 This Year

According to the latest report “State of the Latin American Cryptocurrency Market” by Kaiko Research, Argentinians are increasingly using their national currency to trade digital assets, making the peso the fastest-growing currency in Latin American crypto trading pairs.
This year, monthly trading volume of the Argentine peso against cryptocurrencies has increased by 400%, the highest growth among Latin American neighbors so far. Kaiko states that trading volume of cryptocurrencies against the Colombian peso is the only other pair that increased, but only by 40%, while trading against the Brazilian real and the Mexican peso has declined.
Trading volume YTD by Latin American currency – Kaiko
According to Argentinians in the country, this impressive growth stems from the dollar purchasing fear triggered by Milei’s pre-election on November 19, 2023. José Luis del Palacio, co-founder of the Argentine exchange Decrypto, stated that this fear led to an increase in the use of pesos on cryptocurrency exchanges.
He told The Defiant, “This demand is due to the expected decline before last year’s elections and the possibility of further devaluation of the peso.”
Del Palacio explained that before the election, “nobody stayed in pesos,” which drove the demand for digital dollars.
However, when the Milei government was elected, the currency devaluation did not happen. Del Palacio said that, in fact, people had to sell dollars—bringing the free exchange rate down from 1300 ARS per dollar to 970 ARS—because they had to pay bills and other economic responsibilities.
Nevertheless, now that the market has “cleared” these savings, the dollar is back to 1350 ARS.
Inflation slows down
Argentinians are now more willing to trade in local currency as the country’s inflation rate is declining at the most stable rate since last year.
José Luis del Palacio, co-founder of the Argentine exchange Decrypto, said, “It is expected that [Argentinians] will use more pesos for cryptocurrencies.”
Manuel Ferrari, co-founder of the Bitcoin-backed stablecoin protocol Money on Chain and board member of the Bitcoin Argentina NGO, stated, “The significant decline in inflation might lead to greater use of the Argentine peso on local exchanges.”
According to official data from the National Institute of Statistics and Census (INDEC), the inflation rate in May was 4.2%, marking the fifth consecutive month of decline. This figure is the lowest since January 2022, when it reached 3.9%.
Nevertheless, with a monthly trading volume of $400 million, the Argentine peso (ARS) remains the lowest volume fiat currency in the region, as despite the deceleration in price increases, it remains one of the highest annual inflation currencies in South America.
The annual inflation rate is at its highest in decades, reaching 290% in April. The International Monetary Fund does predict a significant decline, expecting the country’s inflation rate to drop to 149% and 59% by 2025.
USD exchange rate rise
The increase in Argentine cryptocurrency trading volume indicates that as Argentinians continue to seek alternatives for savings and investments in pesos, the peso is still devaluing at a double-digit monthly rate, currency controls have restricted the use of the dollar, and digital assets are a viable option.
Throughout Latin America, individuals find it difficult to obtain dollars, leading them to seek alternatives. Kaiko states that the preferred alternative seems to be Tether’s USDT—over 40% of the region’s trades use stablecoins.
Bitcoin and Ethereum rank second and third, while the second-largest stablecoin on the market, USDC, is not even on the radar.
Del Palacio stated that as the Milei government gradually relaxes restrictions, the cryptocurrency market is beginning to flow freely. His words align with what industry leaders in the country are trying to do with the crypto Silicon Valley Crecimiento in Buenos Aires, which is preparing to establish its own pop-up city in Buenos Aires in August.
He said, “We hope to see a large number of other blockchain-based services added to our local market.”
In terms of overall usage, del Palacio stated that Argentine cryptocurrency is always on an upward trend, “because people and companies trust global and private exchange mediums more than local centralized alternatives.”
He concluded that the 400% figure might drop to below triple digits.