Bitcoin Is Not Reaching All-Time Highs In Argentina
- Bitcoin is currently not reaching real all-time highs in Argentina.
- Individuals placing their funds in fixed-term deposits beat Bitcoin's return on investment (ROI).
There are several websites that inform that Bitcoin (BTC) is reaching all-time highs in Argentina, a country with an inflation of 55% in just a year and an economy contracting around 1%. Although Bitcoin surpassed AR$ 392,000, an all-time high, in real terms, Bitcoin remains far from a stable currency for Argentinians.
Bitcoin Isn’t Reaching All-Time Highs in Argentina
Although Bitcoin surged in the country and the price of the digital asset grew 223% in just a few months against the Argentine Peso (AR$), the virtual currency is far from registering an all-time high in real terms.
Bitcoin Price Plummets After Reaching Almost $20,000
The first thing to mention is that Bitcoin was traded at around AR$ 340,000 in December 2017. This was a clear record high for Bitcoin. Not only in Argentina, but against the US dollar, each Bitcoin was traded close to $20,000. After it, throughout 2018, the price of the most popular virtual currency dropped in AR$ and USD terms. In December 2018, Bitcoin reached a bottom of AR$ 121,000.
Since that moment, the digital currency surged and was able to be traded around AR$ 392,000, an 15% increase from its previous all-time high. Unfortunately for many, this is not the case. Argentina had an inflation rate in from April 2018 to April 2019 of over 55%. This makes of Argentina one of the countries with the highest inflation rates in the world.
Between January 2018 and January 2019, the inflation rate in the country was close to 48% and more than 12% during the first 4 months of 2019.
If we consider that the peso had an inflation rate of 60%, Bitcoin would have to be traded close to $544000 for it to be reaching a real all-time high. Indeed, it would have been much more profitable for an Argentinian to place their AR$ in the bank and expect interest in them than just investing in Bitcoin. Although these are not popular opinions, interest rates are currently close to 69% in the country in annual terms.
BTC Not Always The Best ROI
If Argentinians would have placed their funds in Bitcoin at their all-time high in December 2017, they would now have 15% AR$, far from what a deposit in the bank offers to investors. Indeed, Argentinians could have invested in USD and have 64% more in AR$ than before.
Thus, the narrative about Bitcoin being the best investment tool for Argentinians is not real, at least during the current period of time. Indeed, we have written about it before at Bitcoin Exchange Guide. People were also saying that the local trading volume of Bitcoin in the South American country was growing.
Nonetheless, the Bitcoin trading volume in Argentina for LocalBitcoins dropped in USD terms from December 2017 to December 2018. As we wrote, the country seems to follow a similar trading pattern as developed countries follow, which is driven by speculation rather than by the need of using Bitcoin as a currency.