After a very turbulent 2022 in the cryptocurrency market, this year begins with an encouraging outlook, with bitcoin rising in price and a market that seems to be shaping up to achieve greater stability.
The months of volatility in cryptocurrencies, changes in monetary policy decisions in the United States, regulations to the sector, million-dollar scams and the collapse of some large projects, caused a reorganization of the crypto ecosystem and today they present a panorama of growth more austere but firm.
This is how more and more people are encouraged to enter the world of the “new economy” and the latest data from Americas Market Intelligence demonstrate it. This report places Argentina among the countries with the highest adoption in the region.
Between 15% and 18% of Latin American adults had purchased cryptocurrencies by the end of 2022, a group in which Argentines (17%) stood out compared to smaller percentages of Colombians and Brazilians (14%), Mexicans (9%), Chileans (8%) and Peruvians (7%).
The country’s inflationary context explains, in part, this growth thanks to the adoption by many people of stablecoins, also called digital dollars, as a method of safeguarding value against the lack of access to fiat dollars.
The crypto ecosystem presents many opportunities, but before starting to operate in it, it is essential to take into account some recommendations.
3 tips to enter the crypto world
- Get informed and educate yourself first
As a prerequisite to any financial decision, information, education and advice are essential. Free courses abound on the web and there are hundreds of crypto influencers with online videos.
It may also be a good idea to join one of the crypto communities that exist on networks such as Bitcoin Argentina , which is a private group on Facebook where members share doubts and help each other.
But for those who want to take it more seriously, today there are already specialized academies on the subject such as Defy Education led by Pablo Sabbatella or CryptoGirls .
- Open an account on a secure exchange
Exchanges are digital currency exchange houses. To be able to register in one, you only need ID and a bank account. It is recommended to start with one that has good customer service and a good security ranking, such as CryptoMarket , which has an A+ rating from the Mozilla observatory , and also provides support in Spanish, since it is common for these companies to only respond to the customer in English.
3. Start by buying a stable cryptocurrency and then encourage yourself to acquire other cryptocurrencies
Guillermo Escudero, Chief Revenue Officer of CryptoMarket , recommends starting by acquiring stablecoins, stable cryptocurrencies that do not fluctuate in value -since they are tied to the value of a certain asset- to start on this path.
USDC: USD Coin is a stablecoin (stable cryptocurrency) whose price is anchored at 1:1 parity with the US dollar, thus avoiding volatilities in its value.
They are backed by reserves of cash dollars held in a bank account. It is very common to use it as a store of value, to take refuge against the inflation suffered by the countries of Latam, for local or international payments and also to invest in the so-called decentralized finance (DeFi for its acronym in English).
The most requested assets currently according to the records of the CryptoMarket platform are led by Bitcoin and followed by USDC and ETH, demonstrating the strong penetration that stablecoins have in the region’s market.
Once they managed to have their first stable cryptocurrency, they can move on to a second instance and encourage other cryptocurrencies such as:
Bitcoin: The first cryptocurrency in the ecosystem and also the most famous. Bitcoin (also known as BTC) is a decentralized digital system that can be used as a payment network between people, as well as an investment tool.
Ether (ETH): Ethereum is an open source platform, which is used to execute smart contracts. It has a native cryptocurrency called Ether, which is the second largest on the market after Bitcoin. There are high expectations around it after the last successful update that the network had, which promises a lower environmental impact and greater speed, as well as the creation of other tokens on its blockchain beyond Ether itself, which allows generating other projects. This makes Ethereum as a protocol very interesting and its Ether coin strengthens.
Pax Gold: (PAXG) is also a stablecoin in the form of digital gold backed by physical gold bars and its price is tied to the value of 1 troy oz, so the variations it will have will be the same as those experienced in the traditional market . Each token is backed by a fine ounce of gold from London Good Delivery. When you buy PAXG, you own the underlying physical gold, held in custody by the Paxos Trust Company, a regulated financial institution, and required to keep its assets safe at all times.
DOT: PolkaDot is a blockchain project that aims to create an interconnection infrastructure between different blockchains, as well as improve scalability with respect to other projects and new functionalities to them. It should be noted that one of the creators of PolkaDot is Gavin Wood, co-creator of the Ethereum blockchain. All these factors make your DOT coin have a lot of growth potential.
BONUS TRACK: Dare to trade
What to do with the cryptocurrencies when they are already credited in the virtual wallet.
1- Invest: When you buy cryptocurrencies, you acquire an asset that is deposited in your digital wallet and if it is a volatile currency, the increase in value will depend on whether it improves its price or not. But if it is invested, as in traditional finance, it can increase its value even in passive mode through a concept that in the Bitcoin world is known as ‘Holding’.
2- Make and receive payments: Anyone can make and receive fast payments in cryptocurrencies without geographical limits and in just seconds. According to Ramiro Raposo, Country Manager of Bitwage -a pioneering platform for payment of fees in cryptocurrencies and digital dollars most chosen by workers, freelancers and service exporters-, “For us, Argentina is the country that grew the most in Latam in the last year with a 250% increase in new users and 350% in payment orders processed, being the 3rd country with the highest billing volume in the world. A service exporter receives average payments of USD4,000 per month in cryptocurrencies.”
3- Buy products: Although not all companies have this functionality available, it is estimated that in the near future most businesses will have payment methods with cryptocurrencies. In fact, 33% of Latin Americans have already used stablecoins at some time to make daily purchases and 51% have already made transactions with some cryptoactive, according to the results of Mastercard’s New Payments Index 2022.
4- Transfer money: Cryptocurrency transactions are sending cryptocurrencies from one person to another. Crypto transactions have the advantage of being immediate, they only require a computer and a stable internet connection, in addition to the fact that in most cases cryptocurrency transfers have a lower cost than traditional bank transfers.
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