Argentines are reportedly buying Bitcoin (BTC) instead of the US dollar to protect themselves from currency devaluation.

According to Bloomberg, Argentina-based crypto exchange Lemon is seeing a large increase in Bitcoin purchases as the South American country faces an inflation rate of 276%, one of the highest in the world.

In the week ending March 10th, the exchange recorded 35,000 transactions to buy the flagship crypto asset. This purchase volume is double the weekly average last year.

Other major exchanges in Argentina such as Ripio and Belo also see a similar trend.

According to Belo CEO Manuel Beaudroit, Bitcoin and Ethereum (ETH) purchase volume has so far increased by tenfold in 2024 compared to the same period last year, while the purchase of currency-backed stablecoins fell from 70% to 60%.

“The user decides to buy Bitcoin when they see the news that the currency is going up, while stablecoin is more pragmatic and many times used for transactional purposes, as a vehicle to make payments abroad.” 

The report says the US dollar has lost its appeal as a safe-haven asset over the past two months as Bitcoin’s dollar value rose by 60%, dwarfing the Argentine peso’s 10% gain against the greenback over the same period.

According to economist Nicolas Gadano, Argentines have around $200 billion in US currency savings, surpassed only by dollar holdings in the United States and Russia.

But the report says locals are now using their dollar savings and making investments to protect themselves from inflation.

Bitcoin is trading for $67,817 at time of writing.

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