President Of Argentina Open To Bitcoin And A CBDC, But Central Bank Says No

Argentinian President Alberto Fernandez has declared that he favors the emerging asset class, including digital assets. He also supports the idea of central bank digital currency (CBDC) in Argentina. However, this idea against which the President does not push back against, is not supported and is rejected by the country’s central bank.

In a Filo. news interview cycle by that focused on cryptocurrencies, among other things, the President was asked if he would explore CBDC, or even recognize bitcoin as legal tender, something that El Salvador did earlier this year. To this, Alberto Fernández replied that he would never say no to the idea. The President is not just enthusiastic but also recognizes that legalizing bitcoin can possibly nullify the effects of inflation.

Bitcoin Phenomenon

It shall not be out of place to mention that El Salvador is the unlikely leader for the sovereign adoption of Bitcoin as a national currency. Nayib Bukele, the President of the Republic of El Salvador, had announced during the Bitcoin 2021 conference in Miami that the country would adopt Bitcoin as a second native fiat currency, on par with the U.S. dollar. The legislature passed a new law confirming the announcement a few days later.

For Mauricio Macri, the erstwhile President of Argentina, the defining issue of his administration was high inflation. Despite the nation’s tight control on currency, the President is sure to buy into the increasing conceptions of bitcoin as a safeguard against inflation in the global economy. Fernandez, however, cautiously also noted that the cryptocurrency sector is still in the nascent stage, unfamiliar, and has a volatile nature.

However, Miguel Pesce, the head of Argentina’s central bank, dismissed the President’s willingness to explore digital assets and threatened a crackdown on the crypto industry. Pesce openly targeted cryptocurrency, naming digital assets a threat to a stable economy and signaled stricter regulations for the sector. He likened bitcoin to a commodity and surmised that the country’s National Securities Commission did not and will not treat it as a financial asset.

Pesce intends to ‘regulate the intersection of Bitcoin with the payment system and exchange market‘ and warns that domestic financial stability will not benefit from the cryptocurrency. Concerns range from cryptocurrencies being used to make undue profits to scamming. Wishing to discourage investors from buying crypto assets, Pesce adamantly dismisses Argentina’s suggestion to explore a central bank digital currency (CBDC).

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