Bitcoin and USDT attract modest premiums in Paraguay as millions face banking crisis

Bitcoin and USDT have traded at premiums in Paraguay's peer-to-peer markets as a banking collapse unsettles the country's financial system.

The turmoil has coincided with a 10% surge in the dollar against the Paraguayan guaraní, growing public interest in Bitcoin and calls from crypto executives for alternatives to traditional banking.

Data from CriptoNoticias, which tracks Binance P2P prices, showed Bitcoin's indicative buying price at 498 million guaraníes on Nov. 6. Using an exchange rate of approximately 6,469 guaraníes per dollar, this is equivalent to $76,982.53 and represents a premium of roughly 1.7% over the international Bitcoin price of $75,716.

A review of Binance P2P advertisements on Nov. 5 found a median buying price of 6,399 guaraníes for USDT, about 4% above the previous day's central bank dollar reference rate. The gap narrowed sharply as the official exchange rate caught up with the currency's depreciation.

Meanwhile, Google Trends data showed rising interest in Bitcoin and the dollar across Paraguay.

Searches for Bitcoin began trending upward on Oct. 23 and peaked on Oct. 30, before the formal announcement of Ueno Bank's closure. Interest remained evident as of press time, while searches for the US dollar also increased amid the financial uncertainty.

The developments suggest growing public attention to alternative assets as the country's banking and currency markets face mounting pressure.

Ueno Bank collapse triggers currency selloff and political crisis

Paraguay's central bank initiated resolution proceedings against Ueno Bank on Nov. 2 after determining that the lender's solvency ratio had fallen below half the legal minimum.

The decision disrupted access to deposits for customers of the digital lender, which served nearly 3 million people, and raised concerns about approximately $850 million in public-sector deposits, including pension and healthcare funds.

The financial disruption quickly spread to the foreign-exchange market.

According to local media outlet ABC Color, the retail selling price of the dollar climbed from 5,900 guaraníes on Oct. 30 to 6,500 on Nov. 5, representing an appreciation of approximately 10.2%.

The currency movement coincided with growing scrutiny of President Santiago Peña, who previously held a stake in Grupo Vázquez, the business group controlling Ueno Bank.

Peña has denied wrongdoing and maintained that he sold his investment in March 2025. He offered his resignation on Nov. 5, but lawmakers continued impeachment proceedings the following day.

In a public statement, Peña pledged to cooperate with investigators while urging authorities to prioritize payments to affected depositors.

He added:

“Payment to savers cannot be left pending on what happens to me…My priority was to push, within the law and in coordination with the responsible institutions, the measures needed for savers to recover their savings. Clarifying the facts and resolving the payments are obligations that must move forward at the same time. One cannot be an excuse to postpone the other.”

The central bank has since initiated payments through Paraguay's deposit-guarantee framework, starting with eligible customers holding up to 10 million guaraníes.

Crypto executives promote Bitcoin as an alternative to traditional banking

The crisis has prompted several prominent crypto industry executives to argue that decentralized assets could reduce savers' exposure to banking failures.

Emin Gün Sirer, founder of Avalanche developer Ava Labs, said the developments demonstrated the benefits of cryptocurrencies like BTC, which are held outside conventional financial institutions. He wrote on X:

“[Crypto] assets such as AVAX and BTC are decentralized and require no trust in third parties. No one can take or freeze your AVAX [or BTC] without your consent.”

Samson Mow, CEO of Bitcoin adoption firm JAN3, made a similar argument, suggesting that governments could reduce the disruption caused by banking crises by establishing Bitcoin as an alternative financial network.

He said:

“Bitcoin adoption at a nation-state level can mitigate these types of situations. If BTC is available to the people as a parallel rail, then systemic banking failures have far less impact.”

Mow also said JAN3 met with Paraguay's central bank several years earlier to discuss Bitcoin adoption and the risks of conventional financial infrastructure.

Aave founder and CEO Stani Kulechov joined the discussion, declaring that “Bitcoin matters now more than ever” in reference to Paraguay.

Their comments reflect growing industry efforts to position cryptocurrencies as alternatives during financial crises, particularly in countries facing banking restrictions and currency instability.

However, the market's next test will be whether local Bitcoin and stablecoin activity remains elevated as Paraguay's authorities return deposits and attempt to restore confidence in the banking system.