Strike App Won’t Support Bitcoin in Argentina

The company trumpeted its expansion into Argentina earlier this week, but the Lightning Network-powered app is only supporting Tether’s stablecoin in the country.

Jan 14, 2022 at 10:52 p.m. UTC
Updated Jan 19, 2022 at 1:29 p.m. UTC

Three days after announcing it was launching services in Argentina, the Lightning Network-powered app Strike is only supporting Tether’s USDT stablecoin in the country.

Argentine users have complained the app will not allow them to buy, sell or hold bitcoin as Strike users in other countries can. The company made no mention of supporting only Tether at the time of its Tuesday launch announcement.

In a tweet Strike trumpeted the move into Argentina with CEO and founder Jack Mallers promising “a superior financial experience,” adding that Strike would “use the world's open monetary network, #Bitcoin, to give hope to the people of Argentina.”

Strike’s push into Argentina is part of a wider initiative to expand into Latin America. The company said in its announcement that users would be able to make remittance payments, receive bitcoin tips on Twitter and use Strike's peer-to-peer transaction services.

"In lesser developed markets where the majority of the population doesn't have access to a bank account, or where Strike has yet to establish sufficient banking relationships, Strike uses a US-Dollar stablecoin to represent the dollar cash collateral balance for the user that interfaces with the Bitcoin monetary network," Strike told CoinDesk in an email.

One Argentinian user, Nicolás, told CoinDesk the app can receive bitcoin payments but immediately converts the cryptocurrency to USDT. He said the Strike wallet only holds USDT. Another Strike user in Argentina, Adam, tweeted that the app was “a disappointment,” describing the app as a custodial wallet that works only with tether under Ethereum’s ERC-20 standard.

At the time of publication, Strike had not addressed user complaints on its Twitter account or website.

Adam wrote the app has on- and off-ramps that allow users to connect to the cryptocurrency, such as sending USDT and then receiving bitcoin via the Lightning Network.

Nicolás said that he was able to send funds from his Strike wallet to an exchange in Argentina, after which he received bitcoin.

Responding to Nicolás, Luis David Esparragoza, a journalist for Spanish-language media Criptonoticias, said that Strike sends tether, not bitcoin, to Bittrex, a crypto exchange that holds and transfers Strike's funds.

The company did not answer whether it uses the Lightning Network to make bitcoin transactions or whether it sends USDT to Bittrex and that exchange then converts it to bitcoin.

UPDATE (Jan. 15, 15:49 UTC): Removes an embedded tweet that contained incorrect information.

UPDATE (Jan. 19, 13:25 UTC): Adds comment from Strike.

DISCLOSURE

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Andrés Engler is a CoinDesk business reporter based in Argentina, where he covers the Latin American crypto ecosystem. He holds no crypto.