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I don't have any data points, but my own social circle, of which the majority uses Binance to buy crypto and uses Binance P2P to sell it to ARS (Peso). And sinc

I don't have any data points, but my own social circle, of which the majority uses Binance to buy crypto and uses Binance P2P to sell it to ARS (Peso). And since the transfer will be reflected on your bank balance as some regular person sending you money locally, it's not taxed either. The whole process of buying stablecoins USDC or Tether to it being sold to ARS and actually landing on my local bank account takes about 5 min maybe, which is really nice as well - Western Union and Xoom take up to 3 days or so on average. Most people have used Western Union / Xoom here to get local money, but those have quick limits here, and the government is making it harder and harder to do that, by often prompting to explain your income, then pay taxes on that income, often resulting in double taxation for people. Most of the things in Argentina are still in Pesos (pubs, restaurants, grocery stores, etc), except for the real estate market of which about half the rental listings ask payment in USD, and if you want to buy a car then half the listings of those are also in USD. Lots of local jobs also pay in USD, so I can definitely see how ARS might at some point be devalued and everything going over to USD, but for now for most day-to-day things you still need ARS. I'm by no means saying that crypto is the future or even a great solution, but for the current situation here it is quite convenient and better than any alternative. Edit: To add, if there is one indication of crypto use there, it's that the local Apple Pay equivalent "Mercado Pago", which is available in most shops and restaurants here, has announced that they will add the ability to pay with crypto balance to their app, so I guess there are enough people to warrant that, at the very least.

wpietri 5y ago
Thanks for the details. But I'm not quite following this bit: "The whole process of buying stablecoins USDC or Tether to it being sold to ARS and actually landing on my local bank account takes about 5 min maybe" This sounds like you are going from pesos to pesos in 5 minutes, but I assume that isn't the case. What are you buying the stablecoins with? Also, if I understand the use case directly, there's nothing here that requires a blockchain at all. The same thing could happen with dollars and another centralized company like Binance, yes? It seems like the novel technical part is the person-to-person transactions used to hide that it's a centralized company. Did I get tha right?
- askonomm 5y ago
  I'm buying the crypto with foreign currency, e.g USD or EUR. For example, since I have a U.S company, I effectively make dollars with my work, but to be able to live here I need pesos. And the same would be the case if you work for one of the local companies that pay you in USD, since you still need pesos for day to day stuff. Now, I can of course convert my foreign currency to ARS via a central bank, or a regular bank transfer. But here's the thing: official central bank rate for 1 USD is around 100 ARS. The unofficial rate (Western Union, Xoom, Crypto P2P) gives me 200 ARS for 1 USD. Quite literally double the money. That's a very big deal. And yes, you're right that there is no inherent need for the blockchain or crypto at all, but the lack of oversight is probably the only reason why it is so convenient, and the lack of alternatives, because Western Union and Xoom serve the same purpose, but are much slower (days instead of minutes) and are bombarded with government restrictions. I could, of course, try to find people here directly who want to buy my USD for ARS, and it would function the same way, but Binance P2P offers a marketplace website for that without me needing to find any of the people myself, equipped with escrow functionality so I won't get scammed.
  - wpietri 5y ago
    Got it. Thanks, that's helpful. I definitely agree that evading governmental controls on currency exchange can be beneficial, especially if one's income isn't local. And reasonable when the controls are used to cover up other problems. I also agree that in the short term using centralized digital services can help there, especially ones that don't worry much about fraud prevention or remediation, as they can be very quick. Doubly so if they're tuned for financial crime. But by the same token, the centrality and convenience are major points of weakness if they are going to last. Binance is under regulatory threat the world over, and keeps withdrawing from markets one step ahead of regulators. I'd be very surprised if they are able to do that for you a decade from now. Especially as digital forensics and AML tooling will be a decade better. Instead, I'd guess people in your situation will be doing what they've always done: building informal networks of collaborators so that the regulatory evasion happens offline in ways that are hard to track or limit. Perhaps it will be more like what I saw in Ecuador: friends of friends swapping envelopes of cash when it suits them both. So to me this story isn't about the power of crypto, which is incidental here, or the magic of decentralization, which isn't much in play either. Instead it's about another temporary window where technology has gotten ahead of regulation.

wpietri 5y ago

Thanks for the details. But I'm not quite following this bit: "The whole process of buying stablecoins USDC or Tether to it being sold to ARS and actually landing on my local bank account takes about 5 min maybe" This sounds like you are going from pesos to pesos in 5 minutes, but I assume that isn't the case. What are you buying the stablecoins with? Also, if I understand the use case directly, there's nothing here that requires a blockchain at all. The same thing could happen with dollars and another centralized company like Binance, yes? It seems like the novel technical part is the person-to-person transactions used to hide that it's a centralized company. Did I get tha right?

askonomm 5y ago
I'm buying the crypto with foreign currency, e.g USD or EUR. For example, since I have a U.S company, I effectively make dollars with my work, but to be able to live here I need pesos. And the same would be the case if you work for one of the local companies that pay you in USD, since you still need pesos for day to day stuff. Now, I can of course convert my foreign currency to ARS via a central bank, or a regular bank transfer. But here's the thing: official central bank rate for 1 USD is around 100 ARS. The unofficial rate (Western Union, Xoom, Crypto P2P) gives me 200 ARS for 1 USD. Quite literally double the money. That's a very big deal. And yes, you're right that there is no inherent need for the blockchain or crypto at all, but the lack of oversight is probably the only reason why it is so convenient, and the lack of alternatives, because Western Union and Xoom serve the same purpose, but are much slower (days instead of minutes) and are bombarded with government restrictions. I could, of course, try to find people here directly who want to buy my USD for ARS, and it would function the same way, but Binance P2P offers a marketplace website for that without me needing to find any of the people myself, equipped with escrow functionality so I won't get scammed.
- wpietri 5y ago
  Got it. Thanks, that's helpful. I definitely agree that evading governmental controls on currency exchange can be beneficial, especially if one's income isn't local. And reasonable when the controls are used to cover up other problems. I also agree that in the short term using centralized digital services can help there, especially ones that don't worry much about fraud prevention or remediation, as they can be very quick. Doubly so if they're tuned for financial crime. But by the same token, the centrality and convenience are major points of weakness if they are going to last. Binance is under regulatory threat the world over, and keeps withdrawing from markets one step ahead of regulators. I'd be very surprised if they are able to do that for you a decade from now. Especially as digital forensics and AML tooling will be a decade better. Instead, I'd guess people in your situation will be doing what they've always done: building informal networks of collaborators so that the regulatory evasion happens offline in ways that are hard to track or limit. Perhaps it will be more like what I saw in Ecuador: friends of friends swapping envelopes of cash when it suits them both. So to me this story isn't about the power of crypto, which is incidental here, or the magic of decentralization, which isn't much in play either. Instead it's about another temporary window where technology has gotten ahead of regulation.