Although Bolivia’s foreign exchange squeeze has been building since the decline in gas revenues, major international manufacturers have begun experimenting with digital dollars to keep trade flowing, and in a market where official reserves plunged and parallel rates doubled, such moves reflect pragmatic adaptation rather than ideological endorsement. The dollar shortage that intensified in 2024, driven by reduced natural gas production and collapsing foreign currency inflows, left official reserves below $2 billion and disabled the central bank’s ability to supply dollars at the fixed rate, while parallel market rates surged toward 14–15 bolivianos per dollar. In that context, large firms with complex supply chains confronted acute payment frictions, and alternative payment rails emerged as operational responses to an adverse macroeconomic environment. Toyota, Yamaha and BYD evaluated stablecoin arrangements, *particularly* Tether, as a transactional bridge to settle cross-border obligations without direct access to physical dollars, and the companies treated the technology as a utility to preserve trade continuity. Adoption focused on operational efficiency, with firms using blockchain-based transfers to reduce reliance on scarce central-bank dollars and to avoid the steep premia imposed by black-market exchange rates, while maintaining contractual and regulatory safeguards. Each firm reportedly calibrated exposure carefully, limiting usage to transactional corridors where counterparty verification, liquidity management, and conversion paths back to local currency could be controlled. The move carried financial and legal risks, including counterparty credit, regulatory uncertainty, and the potential for volatile on‑chain liquidity, and companies instituted compliance protocols, custodial arrangements, and limits on holdings to mitigate operational vulnerabilities. Observers noted that while Tether’s peg to the dollar can reduce nominal exchange-rate arbitrage, it does not eliminate systemic risks tied to Bolivia’s fiscal deficits, fuel subsidies, and depleted hard-currency buffers, which continued to exert inflationary pressure and disrupt supply chains. Policymakers faced trade-offs, as sustaining fixed exchange rates and subsidies deepened imbalances that digital workarounds only partially addressed. Oikocredit and local partners, who faced heightened exchange risk and increased provisions due to the shortage, experienced significant operational strain as a result of these market dynamics, highlighting broader sectoral vulnerabilities related to foreign currency shortages. In response, some exporters began pricing contracts in dollars abroad to secure receipts in hard currency and hedge against local liquidity shortages. This pragmatic shift aligns with emerging crypto regulatory frameworks that increasingly shape how cross-border transactions adapt to monetary constraints.
