Latam Insights: Venezuela and Argentina Leverage ‘Unique’ Crypto Use Cases, Brazilian Congress Advises Indicting CZ
Welcome to Latam Insights, a compendium of Latin America’s most relevant crypto and economic news during the last week. In this issue: Venezuela and Argentina use crypto uniquely, according to Chainalysis; the Brazilian Congress recommends indicting Binance CEO Changpeng Zhao, and the Argentine peso keeps falling to record lows.
Chainalysis: Argentina and Venezuela Present Unique Crypto Use Cases
According to a recent article referencing Chainalysis 2023 Geography of Cryptocurrency Report, Venezuela and Argentina use crypto uniquely to tackle their particular issues. Argentina is leveraging crypto to fight the breakdown of its currency, which has reached record lows recently. For Argentines, cryptocurrency (especially stablecoins) presents an opportunity to save in dollars, preserving their purchasing power.
Alfonso Martel Seward, Head of Compliance & AML at Lemon Cash, stated:
We have really high inflation, and there are lots of restrictions against buying foreign currencies. That makes crypto a valuable option for saving. As crypto adoption has grown, lots of people here will now get their paycheck and immediately put it into USDT or USDC.
Also, in the Venezuelan case, Chainalysis explained that crypto is used to fight authoritarianism, enabling remittances to reach Venezuelans and providing refuge against hyperinflation. Leopoldo Lopez, a former Venezuelan opposition leader now in exile, detailed:
Venezuela has had one of the worst-ever hyperinflation rates at over 1 million percent. Cryptocurrency, particularly stablecoins, has helped many Venezuelans overcome this.
Furthermore, he remembered when a crypto-enabled system allowed more than 65,000 doctors and nurses to receive direct aid in 2020 amid the COVID crisis.
Brazilian Congress Advises Indicting Changpeng Zhao
Binance might be heading to another legal battle, as a committee of the Brazilian Congress has recommended the indictment of four Binance officials, including Binance CEO Chagpeng “CZ” Zhao. The committee, comprised of 28 members of the lower chamber of Congress, also called the country’s securities and exchange regulator (CVM) to investigate the exchange for its alleged “repeated violation of the securities market rules.”
Binance stated that it will go to “great lengths” to collaborate with the committee responsible for the investigation, stressing that it “strongly rejects any attempts to make Binance a target or even expose its users and employees with allegations of bad practices without any proof, amid competitive disputes given the company’s leadership position in Brazil and in the world.”
Argentine Peso Likened to Excrement Before Hitting Record Lows
The Argentine peso kept losing value this week, hitting record lows after presidential candidate Javier Milei compared it to excrement. In a radio interview, Milei invited people to save in foreign currency, stating:
The peso is the currency issued by the Argentine politician and therefore cannot even be worth excrement, because that garbage is not even useful for fertilizer.
These statements prompted the filing of two legal complaints against Milei, who was accused of causing the fall of the national currency to 1050 pesos per dollar in its “blue” informal exchange rate.
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