Num Finance calls crypto 'Ideal' for Argentina
Several nations in Latin America rank among the foremost adopters of cryptocurrency, as revealed by Chainalysis' "Geography of Cryptocurrency Report." The document highlights that the primary applications for crypto in these regions are for sending money across borders and as a safeguard against the rising cost of living, with Argentina being a prime example where inflation rates soared into triple digits the previous year.
Agustin Liserra, the head of Argentinian cryptocurrency organization Num Finance, shared insights that there's a pressing need in Latin America for a means to execute global transactions without restrictions, while simultaneously combating the effects of inflation and the devaluation of currency.
"In Argentina, as well as across Latin America, these issues are profoundly impacting the people. It's worth noting, particularly in Argentina under Milei's administration, that there's been a significant drop in inflation. We've managed to reduce it to a single-digit monthly rate, which might not seem like a monumental achievement. However, considering that last year’s inflation rate exceeded 100%, bringing it down to an annual rate of around 50% to 60% represents a considerable improvement," Liserra explained.
Despite indications of economic revival denoted by the falling inflation rates, Liserra pointed out that overall consumption and economic activities are dwindling in Argentina. Furthermore, the scarcity of some products makes the cryptocurrency ecosystem an indispensable solution for these shortages.
Num Finance is revolutionizing the financial industry by offering tokenized versions of conventional financial assets like commodities, equities, and stablecoins peg currency-backed. Additionally, they provide yield-generating products based on these stablecoins. Liserra stated that the focus on these offerings is due to their liquidity and the legal frameworks governing their markets, ensuring customer safety.
"Discussing the reduction of inflation through high-yield offerings, the approach we're taking at Num appears to be highly effective. Providing a stablecoin pegged to national currencies such as the Argentinian peso, offering yields that outpace inflation, presents a strategy to counteract these economic pressures [...] We're of the view that the cryptocurrency sphere still holds considerable potential for expansion within the tangible financial domain, which is our primary focus," he remarked.
Regarding regulatory progress, Liserra mentioned that under Milei's leadership, Argentina hasn't seen significant advancements. Although, there's anticipation for regulatory legislation to emerge in the forthcoming year.
"Presently, there are no obligations for players to inform regulators about their transactions with certain exchanges, just a requirement to register, allowing regulators to recognize the ecosystem's participants. The next step involves collaborating with the government to develop regulations for digital asset service providers. It's unlikely we'll see any regulatory proposals pass this year, but possibly in the next," Liserra concluded.
