“It is not convenient to save in dollars with inflation in the US of 8.3%,” says Argentine expert

For years, the dollar has become the currency most used in Argentina to protect the value of money over time, a phenomenon that occurs due to extreme inflation and devaluation of the peso. However, given the restrictions there are to buy it and the growing adoption of bitcoin (BTC) nationally and globally, added to the economic problems of the United States, the question arises: is it still worth saving in dollars?

CriptoNoticias consulted different specialists on the subject to find out their vision. In response, economist Natalia Motyl forcefully told us: “No, it is not convenient to save in dollars with inflation in the United States of 8.3%”. The American powerhouse recorded the highest rate of price increase in 41 years.

The specialist alleged that the main central banks of the world have shown that every time they own the monopoly on the printing of banknotes they can greatly affect the purchasing power of the currency. “Today the main currencies of the world are corroding their value by the expansionary monetary policies of recent years,” he added.

Therefore, he estimates that the dollar begins to lose its function as a store of value. Given this, he pointed out that the acceleration of the adoption of cryptocurrencies worldwide is no coincidence. He understands that it is the natural response to international distrust of the main institutions of the world.

“As programmed BTC serves to have a healthy currency. Beyond its volatility, as people understand its value, it will begin to stabilize and be used as a currency. In the case of Argentina, as the purchasing power is quite corroded, the main thing is to diversify and cryptocurrencies are an option,” he commented.

Bitcoin is the future in the face of rising inflation in Argentina and the world, experts say

For Motyl, bitcoin is clearly the future. “It’s like gold and a part of the savings that we know we’re not going to use have to be turned over to BTC,” he said. Above all, in Argentina where he believes that inflation will reach about 70% this year in the most optimistic scenario. Currently, it is 58% year-on-year, the highest in 30 years, according to the latest INDEC report.

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From La Crypta, the financial and cryptocurrency advisory company where he is part along with other specialists, they stated that they definitely we lost the war on inflation a long time ago. Mainly due to the lack of substantive structural reforms and an excess of private interests. Therefore, they see it essential to start discussing which are the necessary ways to stabilize the economy and warn that cryptocurrencies are an option that is already being evaluated from the main banks in the world.

Regarding inflation in Argentina, Agustín Kassis, the CEO of La Crypta pointed out to us: “The debate is eminent, I wouldn’t even tell you debate even, because it has already been done. What happened here is that those who are in the hands of the currency are lying to you on purpose. They know this while recognizing that they are the ones who are generating the problem. But, since they are responsible for the problem, they never admit it to you. So, they always blame it on the fact that it is multi-causal and so on, when in no country in the first world is such a barbarity said”.

So, Kassis states that cryptocurrencies may represent a solution to inflation. “We are not going to ask those responsible for the problem for a solution, but we will take it. This is why cryptocurrencies are, precisely, an alternative to the kidnapping that we have in the hands of corrupt politicians,” he declared.

Bitcoin works as a speculative investment, warns Ruffino

CriptoNoticias also spoke with the public accountant Federico Ruffino, who prefers to make a differentiation between what it means to save and invest. He argues that bitcoin works best for Argentines who are looking for an investment asset, precisely because of the price volatility it has, which makes large increases, as well as decreases; so it has risk.

Instead, he commented that stablecoins or stablecoins (cryptocurrencies that maintain 1:1 parity to the dollar) work best for savers that they want to protect the value at par of the US currency. Above all, because of the restrictions that exist in Argentina to buy dollars in the banking system.

“Bitcoin is quite volatile and those who are just entering the crypto world do not see it as a haven of value. I think, for the Argentine public, it is easier to explain what a stablecoin is. Many people who used to go to the dollar bill are switching to stablecoins, which lowers the demand for the physical,” he said.

The specialist inquired that it would be interesting to know how much Argentines have in stablecoins, since this alternative must have lowered the demand for dollars in the country. “We have to see how much the adoption of cryptocurrencies by quite a few savers helped so that the entire Argentine system does not go out of control,” he mentioned.

The accountant considers that in Argentina, those who do not go to cryptocurrency speculation, such as bitcoin, see stablecoins as a viable alternative to the dollar. He pointed out that they must be taking a marketshare or significant market share. That is, given the increase in the use of stablecoins, the purchase of dollars could be going down.

“Notice that they are already starting to accept stablecoins in real estate because obviously for a matter of security, practicality and discretion, many are accepting cryptocurrencies instead of the bill in hand. So I think it’s here to stay, more than anything as an alternative to the dollar bill,” he said.

Although it is worth mentioning that recently there was a case of a stablecoin that lost parity to the dollar, generating concern in savers who use this method. We will have to see how it continues to work.

At the same time, he indicated that there will always be people who enter the market for speculation, being cryptocurrencies an ecosystem that is much more dynamic and easier to access than traditional. For this reason, some Argentines may prefer bitcoin even before investing in the CEDEAR (stock exchange securities) or the Merval (main stock market index of Buenos Aires).

The dollar is losing value, while bitcoin is visualized bullish

Daniel Vogel, the founder and CEO of the cryptocurrency exchange Bitso, recently told CriptoNeticias: “In Argentina we see a huge adoption of bitcoin and stablecoins because of that need to try to maintain their value.” A situation that he sees that grew in the face of restrictions on buying dollars.

“It’s a place where cryptocurrencies make a lot of sense,” he estimated. Although about the stablecoins, he clarified that it must be taken into account that the dollar is losing value. Precisely in 1985, the US currency reached its maximum value and since then it has been devalued. Although in recent years it has managed to recover a little, the dollar still maintains a depreciation of 35% since that time.

Understanding this, then it would be a lie to say that the dollar allows to save, because in the long term it has depreciated in value. However, for some it may still be an attractive asset because it is not devalued as much as the peso does.

In May 2019, the dollar was worth 43.8 pesos, while today it is 207.5 pesos, according to the exchange rate, which means that in three years the national currency depreciated 373%. It is also worth clarifying that at that time it was allowed to buy dollars at the bank or an official exchange house. While now this can only be done by a small group of Argentines with a limit of USD 200 per month, so the informal market has emerged.

However, if what you are looking for is a currency that, instead of being devalued, is valued in the long term, bitcoin may be a better choice. Of course, speculating that its price will increase over time, a trend that has been doing since its launch. The more demand it has, its value could rise and it still has a great chance of growth if it becomes massive.

The cryptocurrency reached an all-time high of USD 67,800 in less than thirteen years since its origin. According to data from BuyBitcoinWorldwide, 106 million people own bitcoin, which is only 1.3% of the world’s population. Therefore, there are reasons to think that its use and price could be drastically increased, as an alternative to the dollar.