Is the Bitcoin dream dead in Argentina?

It’s been a difficult few months for Javier Milei, La Libertad Avanza (the ultraconservative political party he’s affiliated with), and Argentina as a whole, as the country slides back into its perennial issues of overwhelming inflation and a stagnant stock market.

Milei, who took Argentina’s presidential reins in 2023, has been pushing austerity measures and was, briefly, seen as a hero who managed to cut monthly inflation to 1.5% and create a growing economy.

But the love affair with Milei and his citizenry is beginning to sour as he takes emergency measures to ensure Argentina doesn’t once again become a punchline to economics and inflation jokes.

The turnaround from the world’s loudest proponent of austerity measures and lowering public debt to the world’s biggest debt-glutton has been intense.

In April, Milei accepted tens of billions of dollars from the International Monetary Fund (according to IMF data, Argentina now owes more than Ukraine, El Salvador, Ecuador, Pakistan, Kenya, the Ivory Coast, and Angola combined) and is now also hoping for a handout from the US.

This sudden economic faltering hasn’t exactly been impossible to predict. Argentina’s former Minister of Finance, Martín Guzmán, suggested that carry trade speculators were causing capital flight and putting inflationary pressures on the peso.

He ends the article by stating, “For Argentina, the future seems clear: at some point, it will become apparent that a new IMF loan will not fix the current-account dynamic — and even less so if the loan is again used to finance capital flight.

“Exchange-rate pressures will be even larger than if the IMF had not abetted the government, and this will prove very costly to the people of Argentina — and to the IMF itself.”

Read more: How Argentina could impeach Javier Milei for pumping LIBRA

The US is ready to help

Treasury Secretary Scott Bessent stated via X that “Argentina is a systemically important US ally” and that America “stands ready to do what is needed… to support Argentina.”

He added that options to assist the ailing Latin American country “include, but are not limited to, swap lines, direct currency purchases, and purchases of US dollar-denominated government debt.”

What Bessent didn’t specify was what kind of terms would be dictated to Argentina and Milei to receive what more or less amount to loans or what the US would receive in return.

Meanwhile, despite instantly offering aid to Argentina in its time of crisis, the Trump administration has cut off aid to Ukraine, detained and deported South Korean workers, and has dramatic trade troubles brewing between Canada and Mexico.

If one were to squint, it could be perceived that the administration isn’t keen to help allies, but is more interested in propping up another far-right, ultraconservative political leader.

Milei and Crypto: a match made in Hell

Milei’s rise to power included regular praise for bitcoin (BTC) and cryptocurrency, though he’s largely failed to make any headway on cryptocurrency policy proposals.

Additionally, Milei was previously involved in a cryptocurrency scam and is still having his financials investigated by lawyers and judges.

It’s also worth pointing out that BTC isn’t considered legal tender in Argentina and the central bank has banned commercial and retail facing banks from offering clients ways to purchase BTC or other cryptocurrencies.

This is despite the fact that Milei has frequently said the central bank is “one of the greatest thieves in the history of mankind.”

Read more: Javier Milei disbands crypto unit he set up to investigate himself

Indeed, back in 2023, the then-presidential candidate stated that he would do everything in his power to shutter the central bank and get rid of mounting debt.

Rather than take on bankers, the IMF, or even cryptocurrency policy in Argentina, it appears as though Milei has decided to double down on debt and keep the central bank fully operational.

It turns out no one is a libertarian during a financial crisis.

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