What is the future of Bitcoin and other cryptocurrencies in Argentina

The informality of the economy, the problems for the adoption of the technology and the regulatory loopholes are some of the issues that are at the center of the current debate on the future of economy and the trade in the world. Argentina is not far from this problem and, according to the economist Damián Di Pace“the phenomenon of Bitcoinlas cryptocurrencies and the Blockchain It has a high level of adoption due to mistrust in the peso and the existence of an inefficient fiscal and monetary policy.

The Economist will present this Sunday, May 8 at 4:30 p.m. his book “El future of trade that is coming” in the Julio Cortázar Room of the Yellow Pavilion of the 46th Edition of the International Book Fair. The work is about business Intelligence and the keys to business innovation for Small and Medium Enterprises (SMEs), and provides strategies for approaching present and future markets.

Prior to this launch, the author spoke with iProfesional about the economic impact of e-commerce and the cryptocurrencies in the economy and trade, both in Argentina and in the world. He also delved into the problems generated by the tax pressure for the advancement of the digitizationthe need for regulation and how this debate will impact world geopolitics.

Damián Di Pace will present his book at the Book Fair.

-In what stage is the development of electronic commerce in Argentina today?

-10 years ago I wrote a book that talked about the future of trade retailer in Argentina and, at that time, we were coming from a decade of the 1990s in which there had been a high level of concentration by the large supermarkets. Those years were marked by a process of replacing warehouses and small businesses with large surfaces. And, later, came the emergence of shopping malls, which was displacing street shops.

Thus, we arrive at the 2000s, which was a transitional period in commercial matters because everyone thought that the mode of digital commerce was going to replace physics. It was the boom of the dotcom companies, which was later punctured because none of that had any correlation in reality.

In fact, none of that happened, and, now, more than 20 years later, we are at a stage where the electronic commerce has accelerated, but still online food and beverage sales only account for 4% of the total. However, there are other items, such as home appliances, smartphones and electronics, which are sold almost entirely online. So, depending on the good or service, the success of the channel depends digital. And, even in the cases where it is used the most, the physical store has not disappeared. Everything is seen online, but, many times, the purchase is defined at the point of sale.

Argentines see cryptocurrencies as a store of value.

Argentines see cryptocurrencies as a store of value.

-And how has the dynamics of the actors operating in this new market changed?

-Today Ihe big market players are not supermarkets, but are companies such as Alibaba, E-bay, Amazon and Mercado Librewhich are store aggregators, intermediaries in the last mile of the business, who have large storage spaces and do the logistics.

We are at a time when this is in full growth and the pandemic gave it a strong boost: what would otherwise have taken five took place in one year.

In addition, we have a parallel world proposal with purchases such as NFTs, such as Mark Zukerberg’s Meta. Thus, the large concentrators coexist on one side and, on the other, the platforms. A kind of complementarity between some who say “I exhibit and show you” and others who say “I store you and distribute you”.

In turn, the aggregators of e-commerce they help to diversify the offer and, on the other hand, there is an interaction with the networks, which is where the word of mouth of the best businesses occurs.

-What role do they play in this new scenario? cryptocurrencies and virtual wallets?

-There are two papers that changed the destiny of the economy. One is that of Satoshi Nakamoto, who said that a parallel and decentralized monetization system had to be created because the banks in 2008 had been a fraud. Thus, he created Bitcoin. And the other is that of Vitalik Vuterin, who stated that the world has to have a decentralized and distributed monetization in which decisions are made by society.

I consider that, today, the Blockchain and the cryptocurrencies they are in beta version. It is a test stage. We see many scams with these instruments because the exchanges, through which the instruments are bought and sold, are not yet regulated. crypto. But, the projection is that everything we are seeing today, in 40 years’ time, will be decentralized, from the crypto assets even social media. There is not going to be a centralized network, nobody is going to have the data and they are going to be able to use it for whatever they want, it will belong to the people.

The need for crypto regulation is on the BCRA's agenda.

The need for crypto regulation is on the BCRA’s agenda.

-How does regulation play in this process worldwide and in Argentina?

– Only in the United States is there a beginning of regulation of exchanges, so in Argentina it will take a few years to be a reality, surely. At one point, regulation is necessary, but that would give an indication that nothing of what Nakamoto or Vuterin thought is happening in reality. Because, precisely, the regulation by the States would be contrary to what they proposed in their papers.

We are in a process towards a conciliation in that sense, between reality and utopia. The same thing happens with political theories when they are put into practice: because we see that there are no anarcho-capitalist states nor was extreme communism viable. This is something similar.

In addition, the issue of regulation will surely generate a geopolitical division in the world in the face of the debate on what the exchange currency of the future will be. In fact, on the one hand we have China, which jails those who buy cryptocurrencies; and, on the other, the United States is trying to regulate them.

-What view do you have on the evolution of cryptocurrencies and digital wallets in Argentina?

-Unlike the cryptocurrenciesthe wallets digital they are already regulated in the country and have to have the funds in sight. That gives them more security. is coming the technology 5G, which will greatly speed up the data transmission process in the world, but in Argentina it will take longer to adopt. We still have a lot to grow.

We live in a country with 40% of the economy in informality and that places a limit on the adoption of technologies that require formalizing expenses and capital. Our country has high tax pressure and this generates a high level of informality, not the other way around, as many say.

In fact, the creation of more taxes destroys the will to contribute more and more. And the informality of the economy is the ceiling for technological implementation. For example, aliquots of 35% are paid with inflation of 50%. That’s tremendous.

If we are guided by the limit set for the monotax category when the regime began to exist, today it should be around $15 million, but it is really $3.2 million for services and $4.2 million for goods. That is tremendously limiting for the development of enterprises.

The high tax burden is an obstacle to the adoption of technology.

The high tax burden is an obstacle to the adoption of technology.

Because, if you register in the Self-Employed category, you will have to pay 35% of Profits (from $70,000), 21% VAT, 3% of gross income, in addition to municipal and provincial taxes. This is how the number of Self-Employed in the market fell 8.3%. Entrepreneurs prefer to have less growth in their product but reduce the tax burden.

It is impossible to develop in Argentina with these burdens and nothing can be undertaken for the billing limits that exist for the entrepreneur. There is no possibility of reinvesting profits because most of it goes to the State.

And for those same reasons, added to a non-existent monetary policy, which makes nobody believe in the peso, the Blockchain phenomenon was quickly adopted in Argentina. Due to a need for protection against economic policy and against the restrictions to access the dollar.

Hoy, 3 million people have cryptocurrencies in Argentina, mainly for reserve value. And that they are not regulated yet, there is a lot of news about scams and, year on year, those who bet on Bitcoin lost. However, people prefer Bitcoin to the peso due to a lack of confidence in their own currency. He knows that he always loses there.

Electronic commerce became massive in the pandemic.

Electronic commerce became massive in the pandemic.

-In this context, are we heading towards a disappearance of physical commerce?

-That is one of the great doubts of the people before the advance of the crypto and the digital wallets, if physical commerce is going to disappear or not. But the pandemic taught us a lesson: although during all the time that the isolation lasted digital It grew a lot, as that restriction was lifted, all places began to fill with people.

Even, in an Argentina in crisis, with very high inflation, with wages destroyed and mass consumption in decline, we have full restaurants and full tourism, for example. This is because the human being is a social being. That made us see the pandemic. you can Scanning totally, but there is no experience that replaces the physical.

I believe that the current generation, who are digital nativesyou will find the differential in that, in person, compared to the commoditization of the digitization. So, they are going to make purchases online but there will be a complementary face-to-face instance, for sure. In the future, automated stores will initially be a boom but, in the long run, personalized attention will be essential.

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