In Argentina, facing severe inflation, residents are increasingly turning to clandestine peer-to-peer crypto exchanges, dubbed "crypto caves," to purchase U.S. dollar stablecoins, bypassing Bitcoin due to its volatility. These underground exchanges offer a discreet alternative to traditional banking, enabling Argentinians to exchange their devaluing pesos for stable digital assets like Tether (USDT), which are pegged to the U.S. dollar.

Crypto caves operate out of hidden locations, accessible only with prior arrangement, where individuals can convert their fiat currency into cryptocurrencies, primarily USDT, at rates more favorable than the official exchange. The emergence of these exchanges traces back to Argentina's currency controls initiated in the 1980s, which also gave rise to the "blue dollar" - an informal dollar rate significantly higher than the official exchange.

The official exchange rate has escalated from 365 pesos to the dollar to 829 pesos since Javier Milei's presidency, against a backdrop of an inflation rate reaching a 32-year peak of 211.4% in 2023. Despite potential investigations and raids by authorities, crypto caves remain a vital resource for Argentinians looking to preserve their wealth amidst ongoing currency depreciation.

The recent legalization of Bitcoin as a payment method for contracts, a move by President Milei, has not swayed Argentinians towards Bitcoin due to its inherent price volatility. Instead, the preference leans towards using USDT on the Tron network for its stable value and cost-effective transactions.