If you are following the Bitcoin market, you know that prices are spiking a lot recently. Only a few months ago the prices were below $4,000 USD and now they are reaching the level of $8,000 USD and have plenty of space for growth in the near future.
Bitcoin is currently trading at $7,880 USD in the United States and nobody is completely sure why is that happening. There are several theories around but the truth is that no one is absolutely sure whether there is some coordinated effort in order to make the prices go up or if it is simply happening.
Several companies are also starting to use the blockchain technology, which certainly has some kind of effect on the price of the tokens. Microsoft, for instance, is creating the first decentralized infrastructure of a company’s product focused on the Bitcoin market.
Ebay is also starting to accept Bitcoin, which is simply a huge win for the market. Bakkt maybe even approved to be launched soon, so all of this is making Bitcoin trendy again. Google searches are up and the fear of missing out (FOMO) is starting to appear.
After the FOMO, what generally happens is that start to go massively at the crypto world and that will certainly lead prices upward.
Curiously, there is one country in which the price of Bitcoin is already bigger than it was in December 2017: Argentina.
A New All-Time High In Argentina
The price of BTC has reached its all-time high in Argentine pesos (ARS). How can that be if Bitcoin is somewhat worthy less of what it was during the peak of the hype? Well, to understand that, you also have to understand that Argentina has been suffering a lot from inflation and Bitcoin is, effectively, a very deflationary coin.
While Argentina is far from the only nation in which this is happening, this would obviously be a fruitless effort in a country like Venezuela, for instance, because the inflation there is simply completely out of control and this causes a huge problem.
In Argentina, however, inflation is huge but completely uncontrollable. It is in almost 50%, however, which may end up meaning that the country will have to be really careful now if it wants to avoid a complete breakdown of its economic system.
What happened here is that the price of the local fiat currency has decreased so much recently that Bitcoin may be worth around half of what it used to be… but so is the local fiat currency. At the moment, you can buy 1 BTC in Argentina for 365051 ARG.
Will Fiat Inevitably Collapse?
A new election will happen this year, so the president of Argentina, Mauricio Macri, is certainly trying to tame the inflation of the country. He has not been very successful so far, though.
According to some experts like Dr. John Edmunds from Babson College, though, the main problem of the country is not necessarily only inflation, but the lack of access to credit. Only the top of the population can get access to credit and the financial system in Venezuela is actually pretty bad.
Despite that, however, the main case for using BTC in Argentina is certainly inflation. If you bought BTC at the beginning of the year, you will probably have a lot more money this way than you would if you simply held your devaluated fiat.
Argentina and Venezuela give us some unfortunate examples of how the world of fiat might eventually collapse. Fortunately, at least the world has Bitcoin right now in order to survive from this kind of problem.