Argentina has reimposed capital controls, limiting citizens’ and businesses’ freedom to buy foreign currency.
As Bloomberg reported on Sep. 1, the increasingly troubled South American nation took the step as the Argentine peso (ARS) suffers overwhelming losses against major fiat currenciessuch as the U.S. dollar.
Argentina has shown an affinity for Bitcoin (BTC) in recent times, with trade volumes accelerating as uncertainty around the economy grew. Last month, a premium appeared on the country’s cryptocurrency exchanges.
Now, access to hard currency is restricted to just $10,000 for individuals looking to dump ARS on the market, despite its exchange rate falling 34% in USD terms since Aug. 2.
Demand for Bitcoin, a cross-border asset which is impossible to control, should therefore increase further, some suspect.
“Buy Bitcoin,” cryptocurrency-focused attorney Preston Byrne tweeted following the news.
Volume data showed Argentinians trading more in ARS on P2P crypto exchange Localbitcoins last week, a trend which may continue if circumstances follow those of embattled Venezuela.
Argentina’s economic woes may not match those of Venezuela, yet Bitcoin advocates appeared to preempt the crisis months beforehand.
Billionaire investor Tim Draper even met with the country’s president earlier this year to bet on Bitcoin outperforming ARS.
Should Draper win, he demanded Argentina shun the peso altogether, adopting Bitcoin as its new official state currency.
“That would be a perfect decision, as there’s a lack of confidence in this coin,” he reportedly commented at the time of the meeting in March.