P2P Bitcoin trade volumes and inflation in Latin America are on the rise


P2P Bitcoin trade volumes and inflation in Latin America are increasing 3

In the past two months since the March 12 cryptocurrency market rout, also known as "Black Thursday," demand for cryptocurrencies appears to be on the rise in parts of Latin America. Various reports released this week have noted that countries like Colombia, Venezuela, Argentina, Chile, Brazil and Mexico have recorded large volumes of bitcoin trade. However, other reports show that even if volumes are high in these specific countries, they are difficult to measure due to inflation or hyperinflation.

Trade volumes increase in countries like Brazil, Mexico, Venezuela and Argentina, but Fiat currencies in the region are also hit by high inflation

A significant volume of bitcoin trade has taken place in various Latin American countries. The peer-to-peer markets that sell cryptocurrencies are experiencing high volumes in these regions. According to Coin Dance volume statistics, Colombia, Brazil, and Chile have seen significant volumes of bitcoin trading on Localbitcoins week after week. Venezuela and Argentina Bitcoin trading volumes indicate new historic highs and the trend can be seen on Paxful, Mycrypto, Local.Bitcoin.comand other platforms as well. Due to this large volume of crypto trading in Latin America, it had prompted a number of financial media to report that there is significant demand from these areas. For example, the editor of Nikkei Asian Review Naoyuki Toyama recently wrote that "bitcoin is shining in emerging markets plagued by falling currencies" and "from Bueno Aires to Beirut, investors see cryptocurrency as a safe haven."

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Despite reports, some media outlets like Decipher, Crypto Globe, and a few others have shown a different side of the story. For example, it seems that people ignore the fact that fiat currencies in these countries are losing less value every day. Yes, volumes are at an all time high in Argentina, but inflation is worse than it has ever been for Argentines in three decades. Long before the coronavirus, Argentina's inflation rate reached 53.8% at the end of 2019.

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Venezuela is the same way because the rate of inflation of Venezuelans is huge. In February 2020, the inflation rate was 2,910%, but fell to 2,430% in March. However, the significantly higher inflation rate in Venezuela makes it the worst inflation rate in the world by far. Despite the fact that localbitcoin trade volumes in the country are reaching a record level, this does not compare to the 2017 trade volumes when the bolivar was worth more.

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Residents of all countries can take advantage of the private Bitcoin Cash Bitcoin.com private peer-to-peer market today. There are buyers and sellers from Venezuela, Argentina, Chile, Mexico, Colombia and all the nation states of the planet.

Problems with the Iranian rial and the fall of the US dollar

The Covid-19 pandemic worsened the situation in these countries, as the economies of Chile, Venezuela, Colombia, Mexico and all other regions with strong BTC trade volumes have deteriorated. The problems have become so serious in Venezuela that President Nicolas Maduro this week decreed a freeze on rents and wages across the country. Localbitcoins' data has on several occasions presented some discrepancies, especially when it served Iran. Not so long ago, many people and publications said that Iranians paid $ 24,000 a year. BTC.

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The problem with this price estimate was a common misconception about the exchange rate in Iran and how it works. At the time, people observed that a BTC was around one billion Iranian rials, but the calculation of the exchange rate is entirely different. An Iranian national named Mehran Jalali Explain when those $ 24,000 a BTC the headlines came out, how people can get the market rate in USD and the Iranian rial. "The prevailing market rate for the US dollar against the Iranian rial is one dollar for 136,500 rials," said Jalali in January. To make matters even more confusing, news.Bitcoin.com Kevin Helms reported on how Iranian lawmakers recently discussed the reduction of four rial zeros. However, Localbitcoins have banned Iranian traders from trading digital currencies on the platform and residents must now take advantage other options.

It is difficult to measure the amount of demand from a country based on the volumes of Localbitcoins alone. Especially when there are huge spreads and massive inflation ruining these fiat currencies from various Latin American countries. The same could be said someday for the US dollar, and economists predicted the end of the USD after the petro-dollar collapse. Analysts predict that BTC could reach $ 1 million at any given time, and it could very well happen in the midst of hyperinflation in the United States if that were to happen. A number of economists believe that the disappearance of the USD could very well happen, particularly in the midst of the creation by the Federal Reserve of thousands of billions of dollars. So if you think about it logically and consider BTC touch a million USD per piece Would it be very meaningful if the USD was almost worthless?

What do you think of the volumes of trade in Latin America taking into account inflation? Let us know what you think of this topic in the comments below.

Tags in this story

Argentina, BCH, Bitcoin, Bitcoin cash, BTC, Chile, Colombia, Hyperinflation, inflation, Latin America, Latin America Fiat, Mexico, Naoyuki Toyama, Nicolas Maduro, P2P trading volumes, trading, Venezuela

Image credits: Shutterstock, Pixabay, Wiki Commons, Coin Dance, Local.Bitcoin.com

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