Bitcoin surges to record high in Argentina after elections

Bitcoin rose to an all-time high in Argentina after the first round of the presidential election (where parties mainly nominate their candidates) ended in a landslide victory for right-wing populist Javier Milei. The man is originally an economist and promised radical reforms if he also wins the real elections within two months.

For example, Milei wants to abolish the central bank, replace the Argentine peso with the US dollar and is therefore a big fan of Bitcoin. In response to his victory, Bitcoin in the country rose to an all-time high against the Argentine peso.

Inflation

Milei, the far-right libertarian candidate of “La Libertad Avanza” (Freedom Advances) calls himself an “anarcho-capitalist,” and wants to immediately tackle the very high inflation in the country if he also wins the real elections within two months.

🇦🇷 Javier Milei explains why Argentina should make #Bitcoin legal tender. “Bitcoin is the natural reaction against the central bank scammers and to make money private again.” pic.twitter.com/JrYlk9SCev

— Bitcoin News (@BitcoinNewsCom) August 14, 2023

This sky-high inflation (already more than 115% on an annual basis) has been ensuring that more and more Argentines are converting their savings into Bitcoin for some time now. Against the Argentine Peso, Bitcoin is already up 250% this year.

It is unclear whether Milei wants to make Bitcoin legal tender in the country, just like El Salvador did before him. At the moment, he mainly wants to introduce the US dollar and close the central bank, although it is unclear whether investors will agree with his plan.

The central bank reacted by devaluating the Argentine Peso by a further 18% and by raising interest rates.

The market did not expect these numbers from Milei. I think the government will have to be very attentive to the exchange market, it will surely be a week with a lot of tension,

explained analist Dante Sica to the American news site CNBC.

MMollaretti / Depositphotos.com