Facing a series of challenges and difficulties in realizing Argentina’s economic recovery commitments, the newly-elected President, Javier Milei, has announced plans to shut down the Central Bank. This move further raises the possibility of Argentina becoming the next nation to embrace Bitcoin.
The prolonged inflation crisis in Argentina has become a pressing issue, with the Argentine peso experiencing an annual inflation rate of over 140% in the past 12 months. In response, Javier Milei has publicly criticized the country’s central bank, viewing it as a deception and a “mechanism that politicians use to deceive good people with inflation taxes.” He has pledged that if elected President, he would change the country’s political landscape and revitalize the economy, positioning Argentina as the third-largest economy in Latin America.
His unconventional stance and commitment have garnered support from the population, especially the youth, as Argentina grapples with economic turmoil and hyperinflation. Many citizens have lost faith in the ruling authorities and have turned to cryptocurrencies as a hedge against the devaluation of the national currency.
The election results have been viewed positively by Bitcoin supporters worldwide, as Milei has previously expressed support for digital assets. Moreover, it reflects the desire for change among Argentine voters amid political divisions and societal stratification.
Shortly after winning the election, Argentina’s new President announced plans to minimize government spending. He intends to privatize the state-owned Argentine National Oil Company (YPF) and state media agencies while canceling infrastructure projects for public services. He also reiterated his determination to shut down the Central Bank, emphasizing the need to dollarize the economy to “eliminate” the financial institutions that, in his view, “have made the currency issue uncontrollable.”
In the context of skyrocketing inflation and the plan to close the central bank, the crypto community hopes that Argentina will soon follow in the footsteps of El Salvador and officially accept Bitcoin.
The current President of Argentina sees Bitcoin and digital currencies as an effort to “return money to its creators: the private sector.” He emphasizes Bitcoin’s limited supply, considering it a safer alternative to traditional assets like gold or silver.
Despite the determination to shut down the Central Bank and Milei’s positive view of Bitcoin and cryptocurrencies, the practical impact of his government’s policies on the nation’s economy remains unclear.
Moreover, before becoming President of Argentina, he faced controversies, including being sued for promoting a Ponzi scheme called Coinx in Argentina. He denied any wrongdoing, comparing the company’s actions to those of a typical bank.