- Paraguay President Santiago Peña resigned amid political fallout from Ueno Bank’s collapse.
- Ueno Bank’s solvency ratio fell to 5.56%, below Paraguay’s 12% regulatory minimum.
- Paraguay’s banking crisis has increased demand for crypto assets and dollar-backed stablecoins, including USDt and USDC.
Paraguayan President Santiago Peña has announced his resignation amid a crisis triggered by the collapse of Ueno Bank. The collapse of Ueno Bank has cut off access to deposits for millions of customers. The collapse of Ueno Bank has also intensified scrutiny over Santiago Peñas business ties to the lender’s parent company.
Ueno Bank Crisis Triggers Political Fallout
Source: x.com
In a video shared on X on Thursday, Peña said he was leaving his position to protect Paraguay’s stability, social peace and democratic institutions. He also talked about the importance of keeping citizens safe, as they had put their savings into the system.
The Central Bank of Paraguay started taking action on November 2nd after changes to Ueno Bank’s reports made its solvency ratio drop to 5.56 percent, which is much lower than the 12 percent that is required.
Peña had increasing questions about his connections to Grupo Vázquez, the group that controls Ueno Bank. Reports say he was still a business partner until March 2025. The president said he did nothing while lawmakers discussed possible impeachment actions over possible conflicts of interest and other problems with the system.
If Congress agrees to his resignation, Vice President Pedro Alliana is likely to take over for the rest of the term, which ends in 2028.
Paraguay Banking Crisis Fuels Demand For Crypto
The crisis has also shown how cryptocurrencies and dollar-backed stablecoins can serve as sources of liquidity. David Eisenmann, founder and CEO of the Paraguayan crypto exchange X4T, told Cointelegraph that customers were swapping their crypto holdings into US dollars to pay salaries, bills and debts while bank deposits stayed out of reach.
Some people have chosen stablecoins like Tether’s USDt and Circle’s USDC. According to Eisenmann, the prices of both assets, in guaraníes, have risen by around 8% over the past few weeks on X4T. That rise, he said, reflects wider currency trends.
USDt is a lifeline for hundreds millions of people in the world
— Paolo Ardoino 🤖 (@paoloardoino) November 5, 2026
Tether CEO Paolo Ardoino also responded on X, calling USDt a lifeline for hundreds of millions of people during the banking turmoil.
Central Bank Begins Depositor Guarantee Payments
On Thursday, the central bank said that it would pay deposit guarantees to customers of Ueno Bank who had money in the bank up to 10 million guaraníes, but only if they met the rules. In Paraguay, the deposit protection system covers up to 228.3 million guaraníes per person at each bank.
At the time, there were protests in Asunción. People who had money in the bank retirees and workers- were asking for access to their savings and for answers. The government also arrested eight bank managers on November 3. Six of them were put in jail before their trial. Two were kept under house arrest.
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