Victor Ugochukwu · Dec 14, 2020 . 5min read
Bitcoin Trading at an all-time high in South America
South American economies are in bad shape. People in Brazil and Argentina are finding an alternative in Bitcoin, with trading at an all time high.
By Shilika · Aug 11, 2020 . 5min read
The sorry state of affairs in South America, specifically in Argentina and Brazil, has seen Bitcoin trading escalate to record numbers. The Brazillian Real and the Argentine Peso have been slowly but surely losing their value for most of the decade.
Bitcoin and cryptocurrency entered the public’s consciousness around the same time. It is no surprise that the citizens of these countries turn to it as an alternative. Economists believe that Argentina’s economy is the second-worst in the world, behind only Venezuela. Crypto trading is very high here too. Brazil has had unstable leadership plagued with corruption for a long time. This will invariably affect the country’s economy.
Analytics firm Arcane Research published data which shows that Bitcoin has broken price records in Argentina, Brazil, and Turkey. Over the last two months, the growth of Bitcoin in fiat terms has been 169%, 20%, and 5%, in the three countries respectively.
Inflation pushing people towards Bitcoin
With the currencies of these countries draining poorly, it is no surprise that people are looking towards Bitcoin as a storehouse of value. It is happening in other parts of the world too. The injection of massive stimulus packages is forcing people to invest in Bitcoin as a hedge against monetary inflation. South America is moreover the worst hit. The Brazillian Real, for example, has lost 30% of its value when measured against the US Dollar since the start of the pandemic. At the same time, interest rates are also at a record low. This gives people even fewer options to hold their wealth in.
Useful Tulips, a metrics website, shows that the trading volume of Bitcoin in Argentina and Brazil surpassed $1 million and $700,000 respectively last week. With every single Argentinian government since 2007 failing economically, it is hardly a surprise to see the people reject their own currency.
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