On June 9, the small country of El Salvador made history by accepting Bitcoin as legal tender. Could Argentina catch up now?
Central banks around the world are experiencing that you cannot safely print any number of banknotes. Not only the FED has to struggle with the problem of rising consumer goods prices in the USA and has to find a strategy to deal with it. Other countries are also struggling with runaway inflation. Like Argentina: While the exchange rate of the Argentine pesos to the US dollar was still 20: 1, the ratio has quintupled four years later – a reversal of the trend is unlikely.
100 Argentine pesos in 2019 has the same value as 616 pesos today. Despite that, the head of the Central Bank asserts Bitcoin has no value. Apparently he has a firm grasp of the situation. #Bitcoin SoV https://t.co/kx1ViPZjBF
— John B (@tipofico) August 13, 2021
The central bank has so far been unable to counter this movement. The Argentine President, Alberto Ángel Fernández, also seems to have noticed. In a video released on August 12th , he was interviewed on various topics. Among other things, the extent to which cryptocurrencies such as Bitcoin could be used to mitigate or even stop inflation.
Bitcoin could soon be legal tender in Argentina
President Fernández is apparently inclined towards this scenario. When asked whether he could envision Bitcoin as legal tender and thus follow the example of El Salvador, he replied as follows:
That is possible. This would have the advantage that inflationary tendencies would largely be reversed. It is also true that this creates uncertainties as there have been and still are some cases of fraud in the use of cryptocurrencies.
President Alberto Ángel Fernández
The message is to the effect interesting that Miguel Ángel Pesce, head of the Argentine Central Bank, negative only a day earlier to crypto currencies expressed . He does not see a financial asset in Ether and Co.