In a bid to protect the local fiat currency crypto trading crackdown in Argentina appears to be gaining momentum. As per the announcement by the country’s Financial Unit (FIU), the government is tightening its control on crypto trading activities within its borders. This is a decision which appears to have been triggered by the runaway inflation in the country.
The government goes on to say the crypto trading crackdown is a measure meant to prevent crypto related crimes including money laundering. However, the justification appears to hold no grounds; the real problem is that the national currency, Peso has collapsed and locals are turning to crypto for affordable transactions.
Weakening Peso and crypto trading crackdown
Since last year the Peso succumbed to 50 percent inflation. This was before COVID-19 started wreaking havoc on the global economy. The country has defaulted on the national debt and the future looks bleak as the government fights to bring down the hyperinflation while fighting the coronavirus pandemic.
In order to counter the hyperinflation, many Argentinians are turning to Bitcoin and other digital assets to safeguard their funds. This has given the government enough reasons to impose a crypto trading crackdown. Once citizens adopt crypto, this will speed up the collapse of the Peso.
Crypto trading crackdown trending across the globe
It is no secret that many citizens across the globe facing hyperinflation in their countries are turning to crypto. This has happened in Venezuela, Zimbabwe, and Iran forcing the government to impose a crypto trading crackdown. The reason behind the crypto trading ban in these countries is to protect their local fiat currencies.
In all these countries, the crackdown on crypto is yet to prove that it can save any crumbling fiat currency. Any crypto trading crackdown leaves the citizens with no option but to watch their funds exposed to inflation. Turning to crypto ensures they salvage the value of their fiat in the short and long term.