Bolivia will bring cryptocurrencies and stablecoins into its financial system as the country looks for new tools to manage inflation, ease U.S. dollar shortages, and stay competitive globally, Economic Minister Jose Gabriel Espinoza said Tuesday.
According to Reuters, banks will be allowed to hold crypto for customers, letting digital assets be used for savings accounts, credit products, and loans.
“You can’t control crypto globally, so you have to recognize it and use it to your advantage,” Espinoza said.
Bolivia, like much of Latin America, struggles with high inflation. That has pushed many residents to use stablecoins as a store of value and for daily transactions. Analysts say more governments are now turning to crypto because they fear being left behind as adoption accelerates.
Inflation is driving crypto use in Bolivia
Bolivia’s inflation rate averaged above 22% in the year to October, according to the National Institute of Statistics. As prices rise and the boliviano weakens, businesses have begun listing prices in Tether’s USDT, a dollar-pegged stablecoin.
The country’s state-owned energy company, YPFB, said in March that it is building a system to pay for energy imports using crypto, though it has not yet said which digital currencies will be used. And in September, carmakers including Toyota, Yamaha, and BYD began accepting USDT for vehicle purchases amid ongoing U.S. dollar shortages.
U.S. dollars remain critical for international trade and as reserves for central banks. Stablecoins help fill this gap by giving people a way to hold dollar-linked assets without relying on banks or facing strict currency controls. Their growing use across Latin America and other high-inflation economies reflects their role as an alternative store of value.
Featured image from: cointelegraph.com