Can Argentina accept Bitcoin as a legal currency? The Minister of Economy of El Salvador, Maria Luisa Hayem Brevé, issued a new bill for the issuance of digital assets.
The proposed law seeks to create a National Digital Assets Commission to oversee the rights of companies that create digital assets, as well as others involved in the “public provision process” of digital assets.
Under the leadership of President Nayib Bukele, it became the first country in the world to recognize bitcoin as legal tender in 2021. Bukele announced plans to provide $1 billion in bitcoin-backed bonds. An increasing number of businesses, including hotels, restaurants, hotels and even street vendors, are now accepting bitcoin payments. Although large companies use Bitcoin as a trading tool, small traders use it for small businesses and hold it as an investment.
Why does Argentina need Bitcoin compatibility?
In Argentina, alternatives are being sought due to the dramatic devaluation of the peso. The best alternative to money, right now, seems to be cryptocurrency.
Due to its growing popularity, a third of Argentines trade cryptocurrency at least once a month. Most of them believe that the short-term volatility of cryptocurrencies is better than the rapid decline of the national currency.
Samson Mow, CEO of JAN3, argues that Argentina should introduce bitcoin chains and use digital currency as a legal entity. These bitcoin chains can help raise money for other sources of income, in which the proceeds can be used to pay off bonds and buy more bitcoins.
The peso is depreciating rapidly because of the complex web policies that are not realizing its value. Mow went on to say that Bitcoin could eventually replace the peso as the national currency.
Argentinians can mine Bitcoin using natural gas and cheap energy from undeveloped electricity sources, such as in El Salvador, which uses geothermal energy from volcanoes.
Argentines view the US dollar as a long-term currency. However, government regulations have curbed this practice. They impose high taxes on dollar-denominated transactions and limit dollar purchases to $200.
Despite its volatility, Argentines prefer Bitcoin over pesos and dollars.
