Distortions in the Argentine economy only increase as time goes by. The price of the dollar being the center of most of them. An indicator of the situation in which the country is, and that today has four different prices. The official dollar, the tourist dollar, the blue or illegal dollar, and of course the Bitcoin dollar.
The great Argentine confusion
The dollar has been the protagonist of politics in Argentina for a long time. Well, as inflation in the South American country increases, so does the value of the US dollar. Subtracting purchasing power from Argentine citizens, whose salary in pesos is worth much less today than just 5 years ago.
This situation has led the governments of Argentina to try to intervene in the market in one way or another. Establishing purchase limits, differentiated exchange rates, and any mechanism with the potential to serve to limit the harmful effects of the increase in the price of the dollar for the Argentine pocket.
As a result, there are currently at least four different exchange rates in Argentina to take into account. First of all, an official dollar that is currently quoted at 63 pesos per dollar. A blue dollar, name that receives the American currency traded on the black market, at 79 pesos per dollar. A tourist dollar, which is sold to tourists with a 30% surcharge on taxes on the official dollar, and therefore is located at 81.90 pesos per dollar. And finally, a unique phenomenon of Argentina: the Bitcoin dollar.
Bitcoin dollar: a distortion
The Bitcoin dollar emerges in Argentina, as a direct consequence of the restrictions that the government has placed on the purchase and sale of American currency. And, intuitively, one might think that Argentines, with the aim of avoiding the maximum fees imposed by the government to buy dollars, would use cryptocurrencies.
Thus, a person could acquire Bitcoins with Argentine pesos in a broker like Ripio, and then exchange the Bitcoins for dollars, and thus buy as many dollars as he wants. However, this has not worked in this way for the inhabitants of Argentina.
And, in order to guarantee sufficient liquidity of Bitcoins to meet the demand for cryptocurrency in the southern country. Brokers like Ripio must use US dollars to buy these BTC in advance in the international market.
And since, the restrictions imposed on the purchase of the official dollar also apply to these brokers (and even harder due to the laws against cryptocurrencies in the country), they must go to the black market.
This means that the brokers, in order to make a profit, must offer the Bitcoins for a price in pesos that is not equivalent to the value of a Bitcoin in dollars, following the price indicated by the official dollar or the blue dollar. What generates a different indicator of the price of the dollar in pesos in the country, which is obtained by dividing the price of the BTC in pesos, by the price of the same BTC in US dollars.
Current situation of the Bitcoin dollar
Thus, today February 2, with a purchase price of Bitcoin in Ripio of 804,970 pesos, the Bitcoin dollar is located in the $ 86.14. That is, it would be the most expensive exchange rate for the country, and therefore it would not be an efficient way for Argentines to obtain foreign exchange through cryptocurrency.
Probably the most interesting of this price of the Bitcoin dollar, is the increase in the gap with respect to the official dollar and the blue. Well, if we compare the current price of 86.14 pesos per dollar with the price reached at the beginning of January of 76.42 pesos per dollar, we see a significant increase in it in a period in which the official dollar has remained firmly at 63 pesos per dollar, and the blue dollar has only increased by 2 dollars.
All these price distortions do not predict anything good for Argentina. Well, the creation of multiple exchange rates does not solve the underlying problem of the economy. That is, the lack of investments and reliable long-term production, which support the value of the currency.
Therefore, we have a situation in which the blue dollar, which is used as a reference for all businesses that involve foreign exchange in the country, is extremely sensitive to changes in the environment. Making any political or economic breakdown mean an increase in this dollar and therefore in the Bitcoin dollar that arises from it. An effect similar to that generated by any difficulty added to the acquisition of dollars or cryptocurrencies in the country.
International Studies student, interested in economics and international politics. Passionate about the progress of the Fourth Industrial Revolution in general and cryptocurrencies in particular.
