Bitcoin is a little expensive in Argentina as compared to other parts of the world, trading at almost a $300 premium, and showing a $200 rise in premium from around $100 earlier in May.

On the oldest cryptocurrency exchange in Argentina, one Bitcoin amounts to 526,413.15 Argentine Pesos, worth almost $11600. Now, that’s at a time when the price of Bitcoin on Coinbase stands somewhere around $11300.

The premium for peer-to-peer purchases on LocalBitcoin is even bigger, reaching around $1000, as the cheapest Bitcoin goes for about 560000 ARS which is worth almost $12300.

ArgentBTC and Ripio also have a premium reaching $300, suggesting even higher Bitcoin demand in Argentina with not much arbitrage.

The former is probably because arbitrage may turn out to be quite risky due to 55% inflation in the country, and the central bank interest rates growing even higher and apparently fluctuating by the day.

In addition, currency controls might be back in place because of a recent vote indicating left-wing socialists would probably end up winning the election.

“A ticket involving former President Cristina Fernandez emerged as the strongest vote-getter in Argentina’s primary elections Sunday, indicating conservative President Mauricio Macri will face an uphill battle going into general elections in October.

With nearly 59% of polling stations tallied late Sunday, official results gave the presidential slate headed by Alberto Fernandez and his vice-presidential running mate, Cristina Fernandez, about 47% of the votes. Macri and his running mate, Miguel Angel Pichetto, had nearly 33%,” said France24, as general elections are scheduled in October in the country where their currency’s value has plunged.

As interest rates go crazy, they are clearly printing money in desperation, destroying savings as well as debts in Pesos. No one is going to lend the government in pesos. It seems now nobody will be lending them in dollars either as Reuters stated:

“Re-electing Macri would mean seeing through painful cuts in public spending as part of the $57 billion standby agreement he negotiated with the International Monetary Fund last year.”

On the other hand, Fernandez might pull off currency controls and limit their ability to purchase dollars. Furthermore, Fernandez also intends to provide free money, increase government jobs, nationalize the pension funds, and strong-arm the trade unions.

“Argentina remains one of the most closed economies in the world,” says Benjamin Gedan, the South America director of the Obama White House. He further says:

“For 12 years, the [Fernández] Kirchner family had ruled the country, tugging the dominant Peronist party toward statism and friendships with China, Iran and Venezuela.

Macri, a former mayor of the Argentine capital, Buenos Aires, was a multimillionaire whose young political coalition celebrated free markets and sought close ties to the United States.”

The corporate media, therefore, doesn’t find it too welcoming that Kirchner might get into power again, but in her regime during 2007-2015, the inflation rate was around 5%.

Also, as the World Bank reports, the middle class doubled in the country in her term. Besides, the growth even reached 15% at times when she was in office from 2010-2015, while the economy has been shrinking some 6% since 2018.

So, there’s no surprise in her leading the polls, but the currency controls might cause the trade to become a little more difficult.

Bitcoin is always there of course. They can’t apply currency controls as easily as fiat. So, just like the Venezuelans, Argentineans might also discover how useful decentralized currency can be.