Coinbase suspends fiat currency services amid peso exchange rate fluctuations in Argentina

As January 31, 2026 approaches, Coinbase has announced significant changes in the Argentina market. The US-based exchange will suspend local fiat currency deposit and withdrawal services based on the peso exchange rate as of that date. This marks a business contraction just one year after receiving regular regulatory approval in 2025, drawing considerable market attention.

Restructuring After One Year: What Are the Causes?

Coinbase began its full market entry immediately after receiving regulatory approval from the Argentina National Securities Commission (CNV). At that time, the company announced that approximately 5 million Argentinians use cryptocurrencies daily, expressing high expectations for the South American market. However, now it is reaching a point where major services based on local fiat currency will be discontinued.

In particular, the feature that allowed trading USDC stablecoin against the peso will be halted, and users will no longer be able to withdraw pesos to local banks or use on-ramp services. This significantly restricts access for local traders.

High Inflation and Peso Exchange Rate Volatility as Background

Argentina has the highest inflation rate in Latin America, with the value of the local fiat currency fluctuating sharply due to strict capital controls. The ongoing volatility of the peso exchange rate complicates exchange operations and increases risk management challenges.

In this macroeconomic environment, Coinbase appears to have judged that sustaining local peso-based services is difficult. Currency instability and regulatory changes have likely directly impacted the exchange’s business model.

Fiat Services Discontinued, Cryptocurrency Trading Continues Normally

Importantly, this move is not a complete withdrawal. Coinbase described it as an “intentional temporary suspension,” and cryptocurrency-to-cryptocurrency trading will continue to operate normally. Users can still withdraw cryptocurrencies and trade with other digital assets.

Additionally, Coinbase is strengthening collaborations with local partners through the Base ecosystem. In November, local exchange Ripio launched a peso-based stablecoin, wARS, and this cooperative structure is expected to continue.

Reassessment and Plans for a Stronger Return

Coinbase emphasized that this suspension is part of a process to reassess the local situation over time. The company plans to return to the Argentine market with an improved product offering once market conditions stabilize.

Particularly noteworthy is the Argentine Central Bank’s ongoing review of allowing banks to provide cryptocurrency services. With a new regulatory framework potentially in place by April 2026, Coinbase’s strategy appears to be waiting for regulatory changes to re-enter under better conditions.

The Role of Cryptocurrency in the Face of Peso Exchange Rate Fluctuations

In Argentina, peso exchange rate instability has driven increased demand for cryptocurrencies. Many Argentinians have used cryptocurrencies as a means of asset protection amid declining local currency value and strict capital controls.

However, the reduction of local peso-based services by global exchanges like Coinbase ultimately illustrates how peso exchange rate volatility directly impacts exchange operations. Operating fiat-based services in a market with unstable currency is clearly a challenging decision for exchanges.

The Market Reorganization Phase

Coinbase’s suspension of peso services in Argentina goes beyond simple business reduction; it exemplifies how global exchanges respond amid peso exchange rate fluctuations and regulatory uncertainties. The company plans to reassess until the local market improves and the peso stabilizes, with intentions to return in a more robust form.