Javier Milei has once again made a statement that aligns with the views of crypto enthusiasts and free-market libertarians. The current Argentina's president responded to a Twitter post by Gabor Gurbacs, PointsVille founder and a strategist at Tether, that simply said: "Bitcoin a todos" ("Bitcoin for all" in Spanish). Milei elaborated on the matter, proposing free competition of currencies, including Bitcoin and other "units."
"There will be free competition of currencies so if you want to use Bitcoin there will be no problems... and you can also use other units such as WTI, BTU and the one that is most appropriate for your business… In accounting terms, it is solved by the functional currency method…" – the tweet reads in a translated version. For clarity, WTI stands for West Texas Intermediate and BTU refers to British Thermal Units.
Bitcoin against inflation
The post by Milei quickly went viral, receiving thousands of likes and hundreds of shares – and counting. The president's statement sounds optimistic and seems to predict a bright future ahead but the economic situation in Argentina has hardly been going the right way in recent times.
Only in May this year did the country report its first single-digit monthly inflation rate in six months, while the annual inflation remains high, reaching 289.4%1. In recent years, Argentina has grappled with rising prices, and the situation remains complex regardless of encouraging improvement.
Austerity program to fight money printing
To combat the inflation, Javier Milei's administration has implemented a severe austerity program, including cost-cutting and deregulation measures. The president's policies have been praised by the International Monetary Fund and market watchers, but they have also impacted citizens, lowering their purchasing power. Rents soared by up to 90%, and electricity bills nearly tripled for many families. The country has experienced a massive decrease in private spending, which helped slow down the inflation a bit but hasn't solved the underlying problems.
From Milei's perspective, things aren't getting out of hand. The president, who campaigned with a chainsaw symbolizing budget cuts, warned voters that his policies would initially hurt but were necessary to slash deficits fueled by printing money.
Javier Milei and Bitcoin – a complex relationship
With such an approach, Milei has been a natural ally of Bitcoin – a cryptocurrency designed for scarcity, resisting money creation strategies. Argentine's president has publicly expressed his support for using Bitcoin in the national economy on many occasions. However, there's been a misconception that Milei has been pushing the country to a Bitcoin standard, which is not really the case.
Despite his advocacy of Bitcoin, Argentina's president is not following in the footsteps of his El Salvador's counterpart and has no clear intentions of adopting Bitcoin as a national currency. His key economic proposal regarding the currency has been the dollarization of the economy and securing the freedom to transact.
