USDT reaches its highest price in Argentina from the headlight

The contribution of USDT, the Stablcoin issued by the Tether company, reached its highest value in Argentina since the government of President Javier Milei arranged the end of the exchange rate.

At the time of publication of this note, The price of tokenized dollars exceeds the 1,280 pesos lineas seen in the following trainingView graph:

It is worth clarifying that the Argentine government ordered the end of the exchange rate on April 13. As reported cryptootics, the measure, which restricted the purchase and sale of dollars since 2019, was eliminated with the objective of normalizing the exchange market and promoting the entry of investments.

There are several factors that explain the growing demand of USDT and other Stablecoins. One of them is the uncertainty prior to the legislative elections of October 26, which leads many savers to seek refuge in dollarized assets before possible changes in the economic course.

On the other hand, we must not lose sight of the fact that recently in Argentina the bonus was paid, an additional remuneration received by workers in a dependency relationship in June and December. With that extra income, many savers chose to buy “Crypto dollar” as a way of sheltering their money against possible devaluations of the peso.

The increase of all types of dollar (not only the “crypto dollar”) is especially striking because it occurs in the middle of the liquidation of the agricultural sector, that is, the sale of the sale and conversion to pesos of the dollars received by the producers for their exports. Although it exceeded 1.5 billion dollars, The entrance of currencies failed to reduce the demand of savers.

From the Ecolatina consultant, they explained: “The acceleration of the liquidation of the agricultural sector occurs in the midst of two elements. In the first place, a greater seasonal demand of individuals in the season of collection of bonus. And second, a deterioration of expectations due to the ‘day after agriculture’, which precipitates a greater demand at times of what is perceived a cheap dollar and generating a ‘self -fulfilling prophecy.”

The term “cheap dollar” is because many believe that their price will rise soon. Given this expectation, they buy to protect themselves, which in turn increases demand and pushes the price up. That is, the increase finally occurs for the purchases of those who wanted to anticipate.

Meanwhile, the analysts of the consultant Cohen said: “This dynamic occurred despite a strong liquidation of the agriculture, which reached 1,565 million dollars in the same period, which suggests that the demand remained high. A possible explanation is the impact of the collection of bonuses on retail demand.”