
How Bitcoin Is Disrupting Argentina’s Economy - herendin
http://www.nytimes.com/2015/05/03/magazine/how-bitcoin-is-disrupting-argentinas-economy.html
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pakled_engineer
The ferry from Argentina to Uruguay everyday full of people taking money out
of the country to deposit it in banks that won't be skimmed by the government
is much more disruptive than a handful of bitcoin traders.

Bitcoin however is great for avoiding the official fake exchange rate and
getting the real rate, which is often 2x the amount of the official rate. If
you're travelling to BA you want to avoid those sketchy blackmarket
moneychangers floating around. If you're a tourist there's good odds you'll be
receiving counterfeit Argentinian Pesos or end up getting jacked by a guy on a
motorbike after he watches you exchanging money in the streets whereas with
Bitcoin you can safely meet somebody in a coffee shop, do the trade and they
usually have some kind of localbitcoins.com or other online reputation they
want to keep so won't be handing over counterfeits.

Bitcoin hasn't replaced the mass exodus of Argentinians who deposit money
outside the country in Uruguay yet. [http://en.mercopress.com/2013/03/05/an-
estimated-one-million...](http://en.mercopress.com/2013/03/05/an-estimated-
one-million-dollars-trickled-per-day-from-argentina-to-uruguayan-banks)

~~~
kragen
The Buquebus and Sea-Cat ferries (and the cuevas, etc.) are the _incumbent_.
As I understand Christensen’s idea, a _disruption_ is _new_ , _worse than the
incumbent_ (for the incumbent's customers), _cheaper_ , and _adequate for some
new customers_. Without opining on whether Christensen’s ideas are accurate or
valuable in any kind of predictive or analytic sense, I will say that Bitcoin
in Argentina certainly seems like a textbook case.

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cperciva
The ferries are the incumbent disruptor of Argentina's economy. Bitcoin is
disrupting the Argentinian economy-disrupting industry.

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w1ntermute
It's a multilayered disruption machine:
[http://www.newyorker.com/magazine/2014/06/23/the-
disruption-...](http://www.newyorker.com/magazine/2014/06/23/the-disruption-
machine)

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kragen
I think this article is going to result in a crackdown on Bitcoin here in
Argentina.

It’s interesting that it mentions “The American company Coinbase” but doesn’t
mention Coinbase’s Argentine origins. Maybe Brian wouldn’t give an interview
to the author?

This is a good example of why I haven’t been willing to get involved in
Bitcoin so far, despite finding it fascinating: we’ve known since May
presented the Crypto-Anarchist Manifesto at Hackers (1989?) that a likely
endgame of anonymous digital currencies was that governments would lose their
ability to impose capital controls and indeed taxes. While I’m skeptical about
the ontological status or moral value of the State, I also don’t want public
education, policing, and public healthcare to disappear overnight without a
chance to construct alternatives; racism and other hateful ideologies promoted
by States over the centuries to keep their subjects divided can simply explode
into violence.

(I’m not worried about “terrorists and organized crime” — those are of course
terrible but nothing we haven’t dealt with before. I’m worried about the
collapse of governments leading to a collapse of civilization, which is a
thing that has happened before, with disastrous results — the Bronze Age
collapse, the Maya collapse, the fall of Rome, and so on.)

If it catches on, though, continuing to abstain might become as difficult as
Stallman’s continued abstention from using the internet, or the abstention of
the Amish from driving cars. And I will yield.

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hobarrera
> I think this article is going to result in a crackdown on Bitcoin here in
> Argentina.

What surprises me is that the article identified the person with full name and
photo - while his activities are clearly illegal (trading black market dollars
for BTC, tax evasion most likely too).

It's rather imprudent, IMHO.

~~~
kragen
It's not clear that they're illegal, although the article certainly did assert
that they are. Buying and selling commodities for pesos is legal. It’s just,
as I understand it, dealing in foreign currencies without a license that's
illegal (but they daren’t shut that down entirely!), but Bitcoin isn’t a
foreign currency. In fact, maybe it isn’t a currency at all; certainly that’s
the IRS’s position on the matter. Whether AFIP, or the courts trying the case,
will agree, that’s another question — and this article is certainly not going
to help the case of the people mentiond in it.

~~~
hobarrera
I should have clarified a bit: I live in Argentina, and yes, this sort of ARS
for USD trading is illegal. Selling commodities for foreign currency is also
illegal (he states he sells BTC for USD too).

~~~
kragen
Sure, clearly his _cueva_ activities of selling ARS for USD and vice versa are
illegal; I was just talking about the Bitcoin trades.

I think you may be mistaken that “selling commodities for foreign currency is
illegal”, because every Coto grocery store has a sign at every checkout
counter explaining that they accept US dollars and Euros for their groceries,
and at what ratio to the peso. And they’re enrolled in _Precios Cuidados_ , so
whatever illegal things they do, they pretty much have to do them in secret.
There might be something illegal about selling Bitcoin for USD, but I’m pretty
sure that it’s not simply that it’s selling a commodity for foreign currency.

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davidgerard
SPOILER: it's not.

> The number of Bitcoin users in Argentina is relatively small; it barely
> registers on most charts of global Bitcoin usage.

This article is hype: "This article was adapted from 'Digital Gold: Bitcoin
and the Inside Story of the Misfits and Millionaires Trying to Reinvent
Money'". It reads like a press release because it is one.

> This is the street-smart economics. Not the complex Ph.D. economics.

The phrase "I'm not book-smart, I'm street-smart" can be rephrased "I'm not
real-credible, I'm fake-credible." It's the sort of thing expert beginners
say, particularly when they've reached the stage of recognising and
disparaging actual expertise in their subject. And hoo boy, Bitcoiners are at
the far end of expert beginner.

There is no reason to expect anything good or useful from this article.

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kleer001
"The number of Bitcoin users in Argentina is relatively small; it barely
registers on most charts of global Bitcoin usage."

That's the very definition of not disrupting.

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DickingAround
Requiring any disruption to take broad effect before saying it's a
'disruption' makes that word useless. That would be like saying a crack in a
wall doesn't matter till the wall falls over. The real question is whether
this is hairline crack that the rebar of their society will keep in place or
if it's a crack that's unchecked and will continue to grow?

~~~
davidgerard
Requiring a disruption to at least barely register is pretty fair though.
Bitcoin itself barely registers as an economic disruption (though it's got a
lot of coverage for its reputational relation to criminals and scams), and
this "disruption" barely registers in relation to something that barely
registers.

This article is a press release for a book.

~~~
juanignacio
It may disrupt the traditional way money is moved around in the River Plate:
in bags and attached to body in the ferry to Montevideo.

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Nrsolis
While I might have some doubts about the ultimate thrust of this article, my
gut tells me that ignoring Bitcoin as a technology and an ecosystem is a
mistake.

I've been present for three big revolutions in technology (personal computing,
the Internet, and mobile data/smartphones) and with each there were detractors
that dismissed the ultimate effect and utility of these new arrivals. I'm not
so sure we aren't repeating that mistake.

I'm hedging my bets. It might be the case that Bitcoin the currency never
makes it, but the technology that underpins it might live on in some useful
construct when applied to a problem where the utility is more apparent, even
if that connection isn't at all clear now.

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misiogames
Argentinian here, nope, no disruption at all, I actually will argue that due
our history and high volatility of pesos people only trust in-hand hard cash
dollars, anything else is smoke & mirrors :D

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nationcrafting
Just wondering, since you're argentinian... Since there are so many
complications for argentinians wanting to buy dollars, and since the purpose
is to store wealth, why don't we hear much about argentinians buy silver or
gold coins (say, Krugerrands or Sovereigns) instead?

I'm living in Peru, where there were two hyperinflations in the late 80s and
early 90s. The Sol has been very stable ever since, so a lot of people trust
their savings in Soles accounts now, but a few people I've met from older
generations have their savings in silver coins.

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arebop
When I visited Argentina a few months ago, I saw remarkably many gold and
silver shops in BA and elsewhere around the country.

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random28345
"See, Bitcoin isn't just for illegal drug purposes. It's also for illegally
circuventing currency controls!"

Psychic prediction. In ten years, there will be some jurisdictions where
possesion of a copy of the bitcoin ledger will be a criminal offense.

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exelius
Well, Argentina's currency controls are legendary for how awful they are. If
you want a lesson in how NOT to manage monetary policy, look at Argentina
since about 1900. The country was the richest in the world at the time, but
since then has alternated between boom and bust thanks to its disastrous
monetary policy. Evading the government's currency controls is a way of life
for Argentinians.

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Sherlock
The Economist published an interesting report about that some months ago. The
main takeaways were that (1) Argentine was rich, but lagged behind its money-
peers in human development indexes such as literacy rates and (2) The elite
from Argentina benefited from high food prices, so the rest of the country
resented them, a brewing pot for populism.

But your point stands, monetary (or fiscal) policy was awful.

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juanignacio
The Casa Rosada (the equivalent to the White House, home to the executive
branch of the government) tweets ironically about this article:

[https://twitter.com/casarosadaar/status/593584932485779457](https://twitter.com/casarosadaar/status/593584932485779457)

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yellowapple
Anyone have a non-paywalled source? NYTimes won't let me read the article
unless I'm a subscriber, apparently.

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wmil
Open an incognito window and google the article title. Usually cookies and
referrers trip the paywall.

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kolev
No. It's not disrupting anything. Yet. And maybe it never would.

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JDiculous
Man I wish these articles would just get to the point

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juanignacio
Did the NY Times edited the title?

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davidgerard
The headline has been changed to the less obviously ridiculous "Can Bitcoin
Conquer Argentina?"

To which the answer is, of course, "Betteridge."

~~~
davidgerard
And here the Argentinian president's Twitter openly mocks this story:
[https://twitter.com/CasaRosadaAR/status/593584932485779457](https://twitter.com/CasaRosadaAR/status/593584932485779457)

