On the night of August 13, when Javier Milei’s victory in the PASO was consummated, the value of the so-called “crypto dollar” became news: its strong rise suggested a jump in the alternative prices of the US currency the day after.
It is that the demand for stable cryptocurrencies (or stablecoins) skyrocketed after the primary elections, as highlighted by different platforms that offer these assets. The possibility of buying it at any time of the day and the agility to operate, in addition to the possibility of using it as a security of value, are some of the factors that affect its growth.
For example, according to cryptomarket data, after the STEP, transactions on the platform grew 63.55% in August compared to the previous month. “The increase is mainly due to the purchase of stablecoins, specifically USDT and USDC,” they detailed. These types of cryptocurrencies are “tied” to the value of the dollar, which is why they are considered stable and are used as a safe haven.
“After the STEP, the average volume traded with digital dollars on the Bitso platform, in Argentina, practically tripled,” Julián Colombo, Bitso’s CEO, explained to Ámbito, adding: “The so-called ‘crypto dollar’ continues to grow from accelerated manner and has stood out as an alternative for countries experiencing moments of exchange rate uncertainty and economic challenges, such as inflation and devaluation of local currencies. According to Chainalysis, almost 31% of the crypto transaction volume in Argentina currently comes from stablecoins.”
When analyzing the factors that affected growth, he highlighted: “In the elections it is decided who will govern us for the next four years and that clearly has repercussions on the different economic variables. This is in line with the importance that Argentines give to the dollar, so it is logical that a variable that is part of our daily life is affected by uncertainty, which in this case translates into waiting for the results.
“From Bitso we observe how these changes in the situation were reflected in the activity of the application. Since the crypto dollar is the only market that operates 24/7, it is the only place on election night where we could see these short-term changes reflected; the following Monday, when the markets opened, we saw movements in other variables such as bonds, shares or other currencies”, added Colombo. In fact, he remarked that these “digital dollars” are the cryptocurrencies most used by Argentines, since by having their value tied to the dollar, “it allows avoiding the fluctuations that other assets have.” “In Bitso the most used is USD Stablecoin, based on USDC, followed by USDT”, he detailed.
“The impact of the elections resonated loudly and highlighted the transparency and versatility that characterize cryptocurrencies. The operations moved continuously since they are the only coins that can be accessed 24 hours a day. It is extremely interesting to observe how the ‘crypto dollar’ market anticipated what could happen that Monday in the conventional financial market, since the boost in prices is the direct result of supply and demand dynamics,” explained Matías Bari, CEO and co-founder of Satoshi Tango.
The platform offers USDC, USDT and DAI, crypto assets whose parity is “paid 1:1 against the US dollar”. After STEP, stablecoin trading grew 300% on Satoshi Tango.