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I've hired a lot of contract developers in Argentina over the years and most now ask to be paid in Bitcoin. If I wire them USD, between fees, loss from the "off

I've hired a lot of contract developers in Argentina over the years and most now ask to be paid in Bitcoin. If I wire them USD, between fees, loss from the "official" exchange rate, and inflation, they lose 15-30%.

gabythenerd 5y ago
I currently live in Argentina, the loss rate is much higher, between fees and the official exchange rate you lose about 65% of any income you perceive. Aside from crypto, Payoneer is also popular (you go outside the country regularly to get cash).
Izikiel43 5y ago
> 15-30% What a weird way to write 60-70% (you are forgetting taxes)
- wbsss4412 5y ago
  Do taxes only exist in Argentina? Are you advocating tax evasion here?
  - Izikiel43 5y ago
    In Argentina, tax evasion is a way of living, everyone there, young or old, rich or poor, looks for a way to avoid taxes, since taxes coupled with inflation make life very expensive, no matter your income ¯\_(ツ)_/¯ . The best way to live in Argentina is to be a ghost. No bank accounts, nothing declared, everything you own should be on someone else's name, earning usd in a foreign account and you should live on cash (converting usd to pesos as needed).
    - wbsss4412 5y ago
      Tax evasion is likely what’s causing the inflation. Not saying I don’t get why an individual does it, but without the ability to reliably collect taxes, there’s no way to stop rampant fiscal deficits.
      - Izikiel43 5y ago
        No, spending more than you earn like there is no tomorrow for 20 years has caused inflation
        wbsss4412 5y ago
        The US has been running deficits for decades and doesn’t face the same level of persistent inflation as Argentina.
        QuarterReptile 5y ago
        There is no way to succinctly describe all the myriad differences between the two countries that make this comparison unhelpful for understanding Argentinian inflation.
        wbsss4412 5y ago
        Indeed I am using a shorthand her to summarize the issues as well. My response is meant to highlight the fact that the situation is not nearly as “simple” as a government that runs fiscal deficits. I don’t know every detail about Argentina, but broad strokes, when you have a failing political class that is unable to effectively levy taxes and maintain international credit worthiness, you are going to have financial trouble. People love to blame spending and get moralistic about it but that’s typically not the primary issue.
        Izikiel43 5y ago
        Ehh, in this case it is, they are spending much more than we earn, and to cover that they used to take debt. Now no one lends to Argentina at a nice rate, so they emit internal debt by printing a ton of ARS to finance themselves, thus generating inflation. If they stop printing, they have to stop spending as well as cutting spending, leading to a raise in interest rates and a quick economic crash instead of the slow burn situation as of now. The current government is just trying to hold on until next elections, so when the economy explodes they can blame the next government for it.
    - mywittyname 5y ago
      Can you pay for everyday items or rent in USD?
      - Izikiel43 5y ago
        No, cash in pesos, you exchange usd from time to time.
  - 627467 5y ago
    Is tax evasion worst than trading on unofficial channels? I guess it depends on the jurisdiction doesn't it?
    - wbsss4412 5y ago
      I mean none of it is good, but at the end of the day there’s no alternative when trust in government has totally broken down.
  - sbierwagen 5y ago
    It's a failed state. The taxes don't go to schoolteachers or whatever, they go into the offshore account of the local boss.
    - wbsss4412 5y ago
      I am in agreement there.
pera 5y ago
It's actually much more than 15-30% if you go with the official/legal way: I would say you likely lose ~70% at the moment. Most people doing contract jobs in Argentina have a bank account in Uruguay, the US or Europe, and use cryptocurrencies or travel to bring cash.
- anm89 5y ago
  That's pretty astounding. Would you be willing to breakdown how 70% gets lost on a transfer?
  - edko 5y ago
    You will be compelled to exchange your dollars at the "official" exchange rate (which is about 1/2 of the real market value), so you lose ~50% there. On top of that, you have to pay taxes.
  - emi420 5y ago
    When a company sends USD to a bank account in Argentina, the bank must to convert that amount to "pesos argentinos" (ARS), using the "official rate". You can't get USD transferred to your account from other people than yourself (or a company owned by you). Right now the "official rate" is 110,5 ARS for each USD, but if you sell your USD (using crypto or in the "dark market") and get ARS, you'll get 222,5 ARS for each USD. And that's before the taxes.
    - yazantapuz 5y ago
      And you can't bought more than 200 USD per month at the official rate, so the need to bought the USD through an exchange or in a "cueva".

gabythenerd 5y ago

I currently live in Argentina, the loss rate is much higher, between fees and the official exchange rate you lose about 65% of any income you perceive. Aside from crypto, Payoneer is also popular (you go outside the country regularly to get cash).

Izikiel43 5y ago

> 15-30% What a weird way to write 60-70% (you are forgetting taxes)

wbsss4412 5y ago
Do taxes only exist in Argentina? Are you advocating tax evasion here?
- Izikiel43 5y ago
  In Argentina, tax evasion is a way of living, everyone there, young or old, rich or poor, looks for a way to avoid taxes, since taxes coupled with inflation make life very expensive, no matter your income ¯\_(ツ)_/¯ . The best way to live in Argentina is to be a ghost. No bank accounts, nothing declared, everything you own should be on someone else's name, earning usd in a foreign account and you should live on cash (converting usd to pesos as needed).
  - wbsss4412 5y ago
    Tax evasion is likely what’s causing the inflation. Not saying I don’t get why an individual does it, but without the ability to reliably collect taxes, there’s no way to stop rampant fiscal deficits.
    - Izikiel43 5y ago
      No, spending more than you earn like there is no tomorrow for 20 years has caused inflation
      - wbsss4412 5y ago
        The US has been running deficits for decades and doesn’t face the same level of persistent inflation as Argentina.
        QuarterReptile 5y ago
        There is no way to succinctly describe all the myriad differences between the two countries that make this comparison unhelpful for understanding Argentinian inflation.
        wbsss4412 5y ago
        Indeed I am using a shorthand her to summarize the issues as well. My response is meant to highlight the fact that the situation is not nearly as “simple” as a government that runs fiscal deficits. I don’t know every detail about Argentina, but broad strokes, when you have a failing political class that is unable to effectively levy taxes and maintain international credit worthiness, you are going to have financial trouble. People love to blame spending and get moralistic about it but that’s typically not the primary issue.
        Izikiel43 5y ago
        Ehh, in this case it is, they are spending much more than we earn, and to cover that they used to take debt. Now no one lends to Argentina at a nice rate, so they emit internal debt by printing a ton of ARS to finance themselves, thus generating inflation. If they stop printing, they have to stop spending as well as cutting spending, leading to a raise in interest rates and a quick economic crash instead of the slow burn situation as of now. The current government is just trying to hold on until next elections, so when the economy explodes they can blame the next government for it.
  - mywittyname 5y ago
    Can you pay for everyday items or rent in USD?
    - Izikiel43 5y ago
      No, cash in pesos, you exchange usd from time to time.
- 627467 5y ago
  Is tax evasion worst than trading on unofficial channels? I guess it depends on the jurisdiction doesn't it?
  - wbsss4412 5y ago
    I mean none of it is good, but at the end of the day there’s no alternative when trust in government has totally broken down.
- sbierwagen 5y ago
  It's a failed state. The taxes don't go to schoolteachers or whatever, they go into the offshore account of the local boss.
  - wbsss4412 5y ago
    I am in agreement there.

pera 5y ago

It's actually much more than 15-30% if you go with the official/legal way: I would say you likely lose ~70% at the moment. Most people doing contract jobs in Argentina have a bank account in Uruguay, the US or Europe, and use cryptocurrencies or travel to bring cash.

anm89 5y ago
That's pretty astounding. Would you be willing to breakdown how 70% gets lost on a transfer?
- edko 5y ago
  You will be compelled to exchange your dollars at the "official" exchange rate (which is about 1/2 of the real market value), so you lose ~50% there. On top of that, you have to pay taxes.
- emi420 5y ago
  When a company sends USD to a bank account in Argentina, the bank must to convert that amount to "pesos argentinos" (ARS), using the "official rate". You can't get USD transferred to your account from other people than yourself (or a company owned by you). Right now the "official rate" is 110,5 ARS for each USD, but if you sell your USD (using crypto or in the "dark market") and get ARS, you'll get 222,5 ARS for each USD. And that's before the taxes.
  - yazantapuz 5y ago
    And you can't bought more than 200 USD per month at the official rate, so the need to bought the USD through an exchange or in a "cueva".