The lack of attractiveness of Argentine bonds has awakened a new business. Fidustrade, an Argentine fintech company, started to offer a “swap” of the instruments for cryptocurrencies. Despite its ups and downs and volatility, the Bitcoin yield was higher than that of bonds in 2020, according to the company. The service attracts holders who, disappointed with the performance of their investment, seek to recover and secure their capital.
“Months away from the bond exchange proposed by the Government, everything has been going against what was planned by the Minister of Economy, Martín Guzmán. One of the main objectives of the operation was to clear debt maturities in the coming years and to take a series of measures to improve the Government’s future payment capacity. However, investors’ distrust in view of the lack of concrete measures was growing and the result is that the new bonds fell practically to the levels they had when they were in default”, said Fidustrade.
Some of the bonds are trading below US$30. At their debut, after the renegotiation of the debt, they were at US$50. “With a simple calculation and assuming that the swap was made in mid-2020, today the investor would have achieved a capitalization of approximately 1000%. If the trend continues to accompany the crypto world, this alternative would appear to be a valid option,” they commented
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One day after the primaries, Argentine stocks and bonds plummeted at the opening of the markets. Some stocks fell by more than 50% and bonds by close to 15%
The mechanism would be specially designed for clients interested in dollarizing their investments. Fidustrade assures that it does not affect the US$200 quota and has no purchase limit. In addition, the parking period of up to three days imposed for the purchase and sale of bonds does not affect the operation.
“If you have Argentine bonds that were reprofiled, you can now exchange them for Bitcoins in a very simple way and avoiding operational expenses. Please fill out the contact form or register on the platform and a broker will contact you,” says the web page through which customers can access the service.
In addition, the company started to bring the world of cryptocurrencies to the field. The service is a bond-for-grain swap, a value safeguard option for agricultural producers. For now, the swap is offered with wheat, corn, and soybeans, the main crops in the country.
The fintech company exchanges soybeans, corn, and wheat for Bitcoins
Once the exchanges are completed, the fintech deposits the bitcoins in a virtual wallet. The customer can keep them or exchange them for others, including Tether, a cryptocurrency considered stable because it is used to dollarize.
“Once the swap is done, the customer can choose between different DeFi products, from a fixed annual return, take very cheap loans leaving the bitcoins as collateral to trading bots. Since we started with the proposal we have already raised a portfolio of more than US$5 million”, said Juan Pablo Accorinti, COO of Fidustrade.
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First published in LA NACION, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
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