The political economy of cryptocurrency in Latin America

Abstract

This paper explains the political economy of cryptocurrency expansion in Latin America. Based on qualitative research and in-depth interviews, the paper explains the motivations that promote cryptocurrency adoption and the growth of their ecosystems. Building on the cases of Venezuela, Argentina, El Salvador and Puerto Rico, it highlights the importance of bridging material, ideational and infrastructural conditions that facilitate the use of cryptocurrencies. The paper demonstrates that market volatility limits cryptocurrencies’ expansion to specific material conditions where their use can offset other negative structural conditions and where infrastructural deficiencies can be overcome by digital assets. While ideational dimensions of cryptocurrency support are important for some communities of users, ultimately, distortions and constraints in the economy, at the domestic and transnational levels are crucial for adoption.