As election anxiety and a potential multi-billion-dollar United States bailout fuels further economic volatility in Argentina, crypto wallets are seeing stablecoin purchases in the country hit their highest this year.
On September 7, the day of Buenos Aires’s provincial elections, Argentina’s second-largest crypto wallet Lemon saw its highest volume of stablecoin purchases since 2024. The Argentine peso tumbled to a record-low of 1,475 per U.S. dollar in days following.
Argentines can use digital wallets like Lemon to convert their paychecks into USDC, a stablecoin issued by Circle, and convert them back into pesos at time of purchase via a prepaid Visa debit card. This offers store of value protection from currency instability.
“What we can clearly see is that Argentinians continue to turn to stablecoins as a real-time hedge against the political and economic uncertainty that characterizes our country,” said Lemon’s head of business development Ignacio Gimenez said in a statement to the Journal.
The peso jumped 10% last week from its record-lows after Treasury Secretary Scott Bessent announced that the U.S. was preparing a potential $20 billion swap line with Argentina’s central bank. Bessent said the Treasury is “fully prepared to do what is necessary” to stabilize the Argentine government, including purchases of primary and secondary debt.
With Argentina’s far-right President Javier Milei vying for a win in the upcoming October election, the bailout is seen by some to bolster Milei’s chances following his party’s provincial election blunder.
Milei has made steep slashes to the country’s inflation rate since taking office in 2023, but Argentina’s currency and economy at-large remains susceptible to future political and global shock and could continue to boost stablecoin’s attractiveness.
USDC was the third-most purchased cryptocurrency on Lemon in 2024, competing with leading stablecoin USDT, issued by Tether. There is currently over $70 billion worth of USDC in circulation compared to over $170 billion worth of USDT.
However, Circle boosts itself as the more reliable option due to its greater attestation transparency, or proof of reserves signed off by auditors. Every month for the last two years, Deloitte has attested that Circle reserves are equal or greater than the value of USDC in circulation.
While these attestations differ from actual independent audits, this heightened sense of transparency lends to Circle’s continued outreach to markets where local currency is less reliable. Though Circle is based in the U.S., global users like Argentines make up a large chunk of USDC activity compared to Americans.
“There’s an enormous amount of traffic in USDC that is around the world: Europe, Asia, emerging and developing markets, Latin America, Middle East, Africa, Southeast Asia,” said Circle’s co-founder and CEO Jeremy D. Allaire this summer during Circle’s first earnings call following its June initial public offering. “While the U.S. is important, it is not the majority.”