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The trading and financial strain has whetted Argentines’ appetite for bitcoin and cryptocurrencies

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Despite its volatility – which has increased this week with the Fed’s interest rate decision – one of the main winners of the latest turmoil has been cryptocurrencies.

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Bitcoin, the flagship of this sector, has climbed close to 15% in the last month and has recovered positions up to exceed USD 28,000 this Friday. Two cyclical factors in Argentina added to this increase in international prices: inflationary escalation and renewed tension on exchange rates.

In this context, they saw the major crypto wallets in the local market an increase in the movements and also in the registrations of new registered users. consulted by clarionthe majority recognized that the movements recorded in the last ten days were lower than those generated in the last exchange rate run in July of last year, but that there were certain “peaks”.

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Julián Colombo, CEO of Bitsohe explained: “In recent weeks, not only has the price of bitcoin risen, but there has also been an acceleration in the rise in the price of the dollar,” he said, adding: “The increase in the price of bitcoin combined with that of the blue dollar has seen an increase in activity on the platform, both by number of users and by volume traded”.

in the wallet Lemon a similar situation occurred. “Among the companies impacted by the events in Silicon Valley was Circle, the issuer of the stablecoin cryptocurrency $USDC. It suffered a a-peg (loss of parity) over the weekend as it had 8% support of the cryptocurrency in the bank. In Lemon it worked normally over the weekend (buying, selling, exchanging, deposits and withdrawals) and the traded volume was multiplied by 9 in currency exchange compared to the previous weekend,” they explained.

“Faced with this backdrop and the fall in several bank stocks and Wall Street prices in general, many people saw the potential in bitcoin to be the store of value par excellence and a decentralized currency which does not depend on any entity,” they summarized.

Many savers see cryptocurrencies as a way to “protect” against the fear of a new crisis in the “traditional” financial sector. The Fed’s rate hike this Wednesday hasn’t dampened the appetite for cryptocurrencies.

“In the first weekend we saw Withdrawals of 15%.something similar to what happened during the FTX crisis last year,” said Manuel Beaudroit, creator of Beloapp, adding that as the days went by, the number of trades returned to normal.

The Silicon Valley Bank Crisis

The bankruptcy of Silicon Valley Bank (SVB) has been unleashed two weeks ago. a real crisis in the international financial sector, which had its correlate in the cryptocurrency ecosystem.

SVB also provided banking services to USDC stablecoin issuer Circle. The company had about $3.3 billion on deposit with the bank, which is equivalent to about 8% of the reserves backing the stablecoin. Shortly after Circle announced its SVB exposure grade, USDC lost parity, valuing under $1 for the entire post-crash weekend.

This triggered a systemic liquidation of various positions across the crypto ecosystem. A survey published by Chainalysis indicated that the volume of cryptocurrencies leaving centralized services (CEX) has skyrocketed since the onset of the crisis, reaching a high of $1.2 billion on March 11.

Source: Clarin

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