Issuer of the world’s biggest stablecoin, Tether, has struck a partnership with crypto on/off ramp platform KriptonMarket to support USDT transactions in the Central Market of Buenos Aires.
According to a statement by Tether, the collaboration with KriptonMarket will enable the market merchants to accept USDT as payment for goods while also paying their bills and a portion of employees’ wages with the same stablecoin.
Tether Aims To Provide Inflation Hedge For Small Businesses
Regarded as one of Latin America’s largest fruits and vegetable markets, the Central Market of Buenos Aires is home to 900 wholesale and 50 retail businesses, employing a total labor force of 2,000 individuals.
That said, the latest development by Tether is quite exciting for many of these merchants and customers, as the Latin American nation is currently experiencing hyperinflation, which has seen its fiat currency peso drastically decline in value over the last few years.
Data from the National Institute of Statistics and Census (INDEC) shows that Argentina’s inflation moved over 108.8% in April 2023, marking its highest value since 1991.
Tether hopes that the introduction of the new payment system with KriptonMarket will shield Argentine small-scale businesses from the country’s inflation rate as well as eliminate intermediation costs by enabling direct digital transactions between these businesses and their final consumer.
“We hope that bringing Tether to business owners and small shops in Buenos Aires can set an example to later be replicated across the globe,” Paolo Ardoino, Chief Technology Officer of Tether, said.
“With the continuing devaluation of their nation’s currency, the people of Argentina need solutions to pursue their own financial freedom. If we are able to contribute to the well-being of an entire country through the state-of-the-art technologies provided by the blockchain, we will be one step closer to ending the fight against financial discrimination,” he added.
In addition to this innovative payment system, Tether, and KriptonMarket will also be conducting educational programs across the city of Buenos Aires to raise the next generation of crypto enthusiasts and blockchain businesses.
At the time of writing, the USDT remains the largest stablecoin in the market, with a total market cap of $82.9 billion, according to data from Tradingview.
The Role Of Stablecoins In Combating Inflation
Majority of the world’s fiat currencies are known to have a high rate of inflation which is driven mainly by governments printing money into circulation in the face of any economic distress.
That said, rising inflation means a steady decrease in a fiat’s purchasing power, leading to people across the world constantly looking for ways to preserve the value of their earnings and investments.
For nations such as Nigeria, Colombia, Venezuela, Sudan, etc., stablecoins such as USDT have helped serve as an inflation hedge offering many users a way to save, access, and utilize their capital in a modern and innovative manner.
In these developing countries, stablecoins allow businessmen and professionals to earn and transact with assets tied to the value of foreign currencies, thus, serving as a secure, effective route of partaking in the international financial markets.
However, there is still a wavering concern about stablecoins as their values are still pegged to fiat currencies, most often the United States Dollar (USD). Therefore, if the adoption of the USD decreases across the world, it will affect the value of these “non-volatile” cryptocurrencies.