Argentina’s newly elected libertarian president, Javier Milei, has implemented a significant devaluation of the nation’s currency, the peso, by more than 50%. Despite this move, Milei has received praise from the International Monetary Fund (IMF) for his plans to revive Argentina’s economy.
While Javier Milei has previously expressed enthusiasm for Bitcoin (BTC), there hasn’t been an official government policy translating this sentiment into action. However, there are indicators suggesting a pro-Bitcoin stance, such as his earlier comments this year, where he stated that Bitcoin represents “the return of money to its original creator, the private sector.”
Additionally, subtle hints supporting a pro-Bitcoin stance by the president continue to surface online. For instance, Milei reposted a picture of Argentina’s Minister of Economy with laser eyes, a symbolic gesture often associated with support for Bitcoin, on the social media platform X.
In Bitcoin circles, laser eyes symbolize Bitcoin maximalism and a bullish stance on the leading digital asset.
In English translation, the minister was quoted as saying, “My role as Minister of Economy is to increase people’s purchasing power; we aim to prevent officials from deceiving the public with nominal value.”
A recent instance involved a post from a fan account of Milei, highlighting the trending status of both Milei and Bitcoin creator Satoshi Nakamoto on X. This post was also shared by Milei.
It’s essential to highlight that the IMF imposed restrictions last year, discouraging the use of crypto in Argentina when it provided a $45 billion loan to the country.
Peso devaluation and dollarization
The current devaluation of the peso, now standing at 800 per US dollar compared to its previous value of less than 400, brings the official valuation in line with private markets, where the peso frequently traded at over 1,000 to the dollar.
Notably, the Milei administration has opted to maintain the capital controls established by the preceding government, keeping the official rate around 400.
Milei’s overarching strategy involves eliminating the peso entirely and transitioning to a dollarized economy. Concurrently, efforts to curtail expenditure include non-renewal of contracts lasting less than a year, reductions in subsidies for public services, and a one-year suspension of government advertising.
These measures have garnered approval from the International Monetary Fund (IMF), with Managing Director Kristalina Georgieva praising the “decisive measures” as pivotal for restoring stability and revitalizing the country’s economic potential.
