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The purchase of stable cryptocurrencies or “stablecoins” soared in Argentina this weekend after Economy Minister Martin Guzman resigned last Saturday in the face of a rampant economic crisis that the South American country has been going through for the past few years.
Guzman’s resignation, according to a report by CoinDesk, prompted a stampede of Argentines to purchase stablecoins such as Tether USDT and, as a result, cryptocurrency sales tripled over the weekend.
Stablecoins as a new reference to the dollar
As inflation soars, users of major exchange platforms are looking to hedge against a potential devaluation of the Argentine peso. CoinDesk’s report indicated that the local currency depreciated by up to 15% against DAI and Tether stablecoins.
The price of DAI and Tether increased from 245 to 280 pesos between Saturday and Sunday. However, Tether reached 303 pesos following the appointment of Silvina Batakis as Guzman’s replacement.
Sebastian Serrano, CEO of Argentina-based cryptocurrency exchange Ripio, told CoinDesk that stablecoins are the first market where Argentines seek “a price for the dollar,” causing trading volumes to increase.
With year-on-year inflation reaching 60% in May, Argentines are flocking to cryptocurrencies as they seek to protect their wealth in the face of the impending collapse of the local currency.