Argentina may have the right recipe to support turning Bitcoin or any other crypto in the country as legal tender.
Javier Milei, an Argentinian presidential candidate who supports abolishing the central bank and backs Bitcoin (BTC) and cryptocurrencies, has won the primary election in Argentina.
Argentina is suffering from 116% inflation and a severe cost-of-living crisis that has driven 40% of the population into poverty, and this drove support for Milei from regular citizens and cryptocurrency advocates.
Milei has labeled BTC and other cryptos like Ethereum as a “return of money to its original creator: the private sector.”
Milei doesn’t advocate for Bitcoin’s adoption as the official currency in Argentina but supports a transition to dollarization as a way to combat inflation.
Milei had his share of controversies when he allegedly promoted a Ponzi scheme called Coinx using AI-driven automated trades.
Argentina’s National Securities Commission (CNV) later instructed the platform to halt its operations following disappointing results for investors.
The country’s Central Bank continues to attempt to curb crypto activity by banning digital wallets.Â
Read: UMU Unicoin: A stablecoin or early global CBDC salvo?
Countries already adopting BTC as legal tender
Latin America and the Caribbean lead in terms of digital money adoption.
The Bahamas pioneered the introduction of a CBDC with the Sand Dollar in 2020. Jamaica has followed suit. Brazil’s CBDC project is also in the advanced Proof-of-Concept stage, seeking to turn assets, such real estate, stocks, and commodities, into tokens to facilitate their transfer and increase their liquidity.
Brazil, Argentina, Colombia, and Ecuador ranked in 2022 among the top 20Â in global adoption of crypto assets.
But it’s El Salvador that has caught global attention when in May 2021 it made BTC a legal tender, becoming the first country in the world to do so.
But volatility risks prevail in adopting unbacked crypto assets and relying solely on supply and demand even when explicitly supported by the government.
A 2022 national survey suggests that Bitcoin is still not a widely accepted medium of exchange in the country.
On April 27, 2023, the Central African Republic (CAR) also adopted BTC as a legal tender despite being one of the poorest countries in the world. It hopes the move will reduce dependency on the US Dollar and bring prosperity to the country in the coming future.
In 2021, a special economic zone in a tourist-centric island in Honduras adopted BTC as a legal tender as well.
Countries aiming to adopt cryptos
Terrance Drew, the Prime Minister of the Caribbean nation of Saint Kitts and Nevis said in November 2022 that the country may adopt Bitcoin Cash (BCH) in 2023 as part of their CBDC program DCash.
Meanwhile, Carlitos Rejala, a member of Paraguay’s Chamber of Deputies, proposed a bill for accepting BTC as legal tender in the country.
Just a couple of years ago, Ukraine made known its aims to become one of the foremost authorities on crypto. The war Russia waged against the country prompted people across the world to donate millions through crypto payments in support of food and basic supplies.
Venezuelans have been using crypto for a while to pay for their daily requirements, so decreeing BTC as a legal tender is not a stretch.
The US is a top cryptocurrency market but the US regulatory system there is feuding with top crypto exchanges delaying any moves for crypto adoption any time soon. Russia’s war in Ukraine also stands in the way of such legal consensus over crypto adoption.
Bitcoin, which has been stuck in the $30,000 price range, would likely witness a boost should any of these countries make their move towards legally accepting cryptos as legal tender.
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