Argentina’s New President Implements 50% Currency Devaluation
The newly elected President of Argentina, Javier Milei, has announced a significant devaluation of the Argentinian currency in response to the country’s economic emergency. The move will devalue the Argentine peso by 50%, resulting in 800 pesos to the US dollar. Economy Minister Luis Caputo acknowledges that the situation will worsen initially, but argues that Argentina has an “addiction” to fiscal deficits. The country is currently facing 143% annual inflation and widespread poverty. This decision comes after Argentina’s central bank raised interest rates to a record 133% two months ago.
Bitcoin Prices in Argentina Cool Down
Bitcoin prices in Argentina recently reached an all-time high against the local currency, surpassing 16 million ARS. However, with the devaluation of the peso, this gap is expected to widen further. Currently, Bitcoin can be purchased for just under 15 million pesos in Argentina. On a global scale, BTC spot prices have experienced a decline of 2% and are trading at $40,880 at the time of writing. The cryptocurrency market is undergoing a correction phase, with Bitcoin losing 8% since its peak of $44,380 over the weekend.
Hot Take: Impact on Bitcoin Adoption in Argentina
The devaluation of the Argentinian currency may have unintended consequences for Bitcoin adoption in the country. With increasing economic instability and inflation, more individuals may turn to cryptocurrencies as a store of value and means of exchange. Bitcoin’s decentralized nature and limited supply make it an attractive alternative to traditional fiat currencies that are subject to government intervention and devaluation. As more people experience the benefits of using Bitcoin in everyday transactions, its utility and acceptance are likely to grow further in Argentina.
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