Stablecoins rose in value over the weekend as a result of the peso’s steep decline in Argentina.
The peso fell roughly 15% versus stablecoins DAI and Tether on many major local markets after Guzman’s departure. Over the weekend, the value of both stablecoins jumped from 245 pesos to 280 pesos.
Consumers purchased up to three times as many stablecoins as normal over the weekend, according to major cryptocurrency exchanges, as an impending economic disaster loomed.
A probable (further) depreciation of Argentina’s peso (ARS), whose buying value has dropped in recent years as inflation has risen, has prompted cryptocurrency exchanges to report that customers are trying to hedge against this possibility.
“Due to the 24/7 nature of cryptocurrencies, Argentina is the first market to try to price the U.S. dollar every time one of this news is published in Argentina. Volumes have so increased”, Argentine cryptocurrency exchange Ripio CEO Sebastian Serrano told CoinDesk.
“Due to the 24/7 nature of cryptocurrencies, Argentina is the first market to try to price the U.S. dollar every time one of this news is published in Argentina. Volumes have so increased”
Sebastian Serrano, Ripio CEO
Tether prices on Argentine markets surged to ARS 280 per coin after the selection of Silvina Batakis to replace Guzman as the new Economy Minister on Sunday night.
Alberto Fernandez’s conflict with Cristina Fernandez de Kirchner over the economic policy of Argentina has resulted in the resignation of Guzman, the country’s treasury secretary. Argentina’s central bank is also running low on foreign currency reserves, which is affecting imports, among other things.
The number of transaction reports is going up
Most Argentine exchanges extended the margins between the bid and ask prices to 18% over the weekend, when they typically remain around 2%, due to the absence of price references for the US currency.
As a result of the significant demand for cryptocurrencies after Guzman’s departure and the absence of a reference repo price, prices have risen and spreads have wider, according to Lemon Cash’s head of trading and strategy Andres Vilella Weisz.
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