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Citizens of one of Latin America’s strongest economies are turning to Tether and USDC amid a historic devaluation of the Chilean peso.
- In the midst of economic difficulties, Chileans resort to stablecoins.
- Local exchanges have seen an increase in USDC and USDT transactions.
- Accessing digital digital technologies are these electronic tools that have the ability to generate, store or even process data. dollars is easier than opening a bank account.
Cryptocurrency cryptocurrencies are digital currencies that use cryptographic technologies to secure their operation. exchanges in Chile are seeing a surge in demand for the stable coins pegged to the U.S. dollar as concerns about an economic crisis grow.
Un report by CoinDesk Wednesday’s issue provides data indicating that an increasing number of Chileans are resorting to the stablecoins to protect themselves from inflation a general increase in prices and fall in the purchasing value of money. and the increasing devaluation of the local currency. According to the report, several exchanges local markets have seen a notable increase in transactions involving these assets.
CryptoMarket a exchange businesses that allow customers to trade cryptocurrencies for fiat money or other cryptocurrencies. which serves about 200,000 users in the country, recorded a 50% increase in purchases of the two main digital asset stablecoins ,Tether (USDT) y USD Coin a coin can refer to a cryptocurrency that can operate independently or to a single unit of such cryptocurrency. (USDC), during the second quarter of 2022, as indicated by the manager of CryptoMarket Chile, Eduardo Pérez de Castro, to that news agency.
Today stablecoins represent 30% of the total purchases of users, and what they mostly choose to buy if it is the first time they use the platform.
USDT and USDC transactions increase
Buddha.com one of Chile’s leading crypto-trading platforms with more than half a million users, has also seen a surge in demand for stable coins, whose share rose from 11% in June to 20% in July on that platform. USDC, which was listed less than a year ago, has become its third most traded digital asset after Bitcoin the biggest and most popular cryptocurrency in the world. It is a decentralized digital currency that enables users to make trustless peer-to-peer transactions. yEther the form of payment used in the operation of the distribution application platform, Ethereum..
“ The average Chilean is turning to stable currencies to save money and preserve value ” commented Joel Vainstein, co-founder of OrionX , otro intercambio con sede en Chile que ha visto esta tendencia. Con más de 100.000 usuarios, esa plataforma ha tenido a USDT as one of its most traded currencies over the last three months.
The move comes amid record inflation for the country and a number of factors, including an unstable political context. In recent weeks, the price of the dollar in Chile has been easing on fears of a turbulent macroeconomic backdrop.
The U.S. currency currency is a medium of exchange that defines value. reached an all-time high above 1,000 Chilean pesos in mid-July. Tensions between the US and China have led to a reduction in demand for copper, which has depressed the price of the metal (the main source of foreign exchange from exports), generating negative repercussions for the economy and pushing the price of the dollar to levels never seen before.
The dramatic rise of the U.S. dollar forced Chile’s central bank to make a intervention of USD $25 billion in the foreign exchange market an area or arena, online or offline, in which commercial dealings are conducted. to stop further devaluation. The maneuver caused a historic drop in the price of the dollar of 3.7% in one day. Only a month earlier, in June, the dollar’s year-on-year inflation had rebounded to 12.5%, a 28-year high.
Difficulty a measure of how hard it is to validate a new block on a blockchain. in accessing dollar accounts and other factors
According to reports, this backdrop of economic instability, coupled with expectations of a vote on a constitutional change change — a concept relevant to cryptocurrencies that use the UTXO model — is the number of coins sent back to a user after they use their unspent outputs to initiate a transaction. in September, has prompted citizens to turn to foreign currencies for refuge. Not only have cryptocurrency exchanges seen an increase in demand for stablecoins but also the banks in terms of dollar accounts.
However, it is not feasible for all citizens of the country to open accounts in foreign currencies, as the following points out CoinDesk . Con frecuencia los bancos exigen una serie de requisitos como monto mínimo de ingreso sobre los USD $500, contrato de trabajo, certificados de cotización en un fondo pensión, e incluso la acreditación de actividades comerciales en el extranjero.
This could be one of the factors behind the increasing demand for stablecoins en Chile. “ We see this as a big trend and something that users are taking as a opportunity to buy dollars easily without having to go to a bank or exchange house “commented Jazmín Jorquera, operations director of Buda , a CoinDesk .
A medida que la economía chilena siga experimentando los efectos de la crisis global, es posible que más ciudadanos opten por recurrir a monedas estables como USDT y USDC como una forma de protegerse de la inflación local.
Meanwhile, cryptocurrency exchanges in the country continue to face challenges due to the lack of regulation and await the implementation of new laws that guarantee them legal protections; especially in the face of arbitrary decisions by financial institutions, with which they have been struggling for the unjustified closure of accounts for several years.
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Article by Hannah Estefania Perez / DiarioBitcoin
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