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Several Latin American countries are in the top 20 for cryptocurrency adoption, according to Chainalytic’s “Cryptocurrency Geography Report.” The report notes that the most popular use cases in the region are international remittances and inflation prevention, the latter of which is particularly seen in Argentina, where inflation has exceeded triple digits last year.
Agustin Liserra, CEO of Argentine cryptocurrency company Num Finance, explained that Latin Americans need tools for permissionless global transactions while mitigating inflation and currency devaluation.
“This is the real suffering experienced by people here in Argentina and in Latin America in general. I would also like to say that here in Argentina, with the Millais government, inflation is decreasing rapidly. So we’re below single-digit inflation on a monthly basis, and that’s important to make clear because that doesn’t seem like a real success. But in Argentina, where inflation was higher than 100% last year, if inflation is around 50% or 60% per month per year, that equates to an improvement,” Liserra said.
Despite signs of recovery through falling inflation figures, Liserra highlights that Argentina’s consumption and economic activity are declining overall. Moreover, some products cannot be purchased domestically, making cryptocurrencies an ideal ecosystem for “this kind of need.”
Num Finance offers tokenized versions of traditional financial products such as commodities, stocks, and currency-backed stablecoins. It also offers income products based on these stablecoins. Liserra explained that the focus of these products is related to liquidity and regulation around markets to protect customers.
“And for example, when you talk about mitigating inflation with high-yield products, what we’re doing with Num seems really useful for people to hold a stablecoin in a national currency, like the Argentine peso, at a very high yield. This is a tool that helps mitigate this compared to inflation. (…) We are focused on the cryptocurrency industry because we believe it still has a lot of room to grow in terms of financial reality.”
On the regulatory side, Liserra emphasized that no significant developments have taken place in Argentina since Milei became head of the executive power. But regulatory legislation may come to light next year.
“There is still no regulation on the obligation for clients to inform regulators about the operations they perform on a particular exchange or similar, but there is only a registration to inform regulators who the players in the ecosystem are. The idea is to then work with governments to elaborate regulations for digital asset service providers. “I don’t think this rule will see the light of day this year, and maybe it will be the next rule.”
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