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Argentina hastens legislative steps for digital peso amid political divisions

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TL;DR

  • The Central Bank of Argentina is fast-tracking legislative efforts to introduce a digital peso, with backing from Minister of Economy and presidential candidate Sergio Massa.
  • The digital peso initiative faces opposition from another presidential candidate, Javier Milei, who advocates for the U.S. dollar to become Argentina’s official currency and is critical of the central bank’s role in the economy.
  • The digital peso is seen as a tool for economic stability and improved tax collection, but its political fate is uncertain and hinges on the outcome of the upcoming elections.

In a significant pivot towards modernizing its financial systems, the Central Bank of Argentina is doubling down on its efforts to launch a Central Bank Digital Currency (CBDC). This move comes as the nation grapples with political divides over the future of its economy.

Politics and the CBDC: A balancing act

Recently, Juan Agustín D’Attellis Noguera, a director at the Central Bank of Argentina, announced that the bank is accelerating its work on the legislative framework for a digital peso. Moreover, this initiative has garnered the endorsement of Sergio Massa, Minister of Economy and presidential hopeful. 

According to Noguera, the project aims to see the light of day “as soon as possible,” pending introduction in the Congreso de la Nación Argentina, the country’s parliament. Besides this, Massa has committed to implementing the digital peso if he emerges victorious in the upcoming presidential election.

However, not everyone is on board with the digital peso plan. Another presidential candidate, Javier Milei, a staunch Bitcoin advocate, has been vocal about his strategy for the “dollarization” of the Argentine economy. Milei, in contrast to Massa, strongly opposes the central bank’s role in shaping the economic landscape, promoting instead the adoption of the U.S. dollar as Argentina’s official currency.

The digital peso: A tool for economic stability?

Noguera has been a consistent proponent of the CBDC, expressing that a digital peso could bring about stabilization in the Argentine economy as early as 2024. One significant advantage he points out is traceability. This feature would make it easier for the government to collect taxes, a crucial element in a nation striving to deal with inflationary pressures.

Massa, who is marginally trailing Milei in the latest polls, sees the digital peso as a pivotal tool for tackling Argentina’s chronic inflation issue. Consequently, it’s clear that the political fate of the digital peso is hanging in the balance, dependent on the outcome of the upcoming elections.

Additional details surrounding the legislative process and timelines for the CBDC are expected to be released in the near term. Meanwhile, the public waits to see how this ambitious project might fit into a divided political atmosphere. Hence, it’s safe to say that Argentina’s journey towards a digital currency will be anything but a straightforward path, with political and economic ramifications that extend far beyond the confines of the central bank.

Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.

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Damilola Lawrence

Damilola is a crypto enthusiast, content writer, and journalist. When he is not writing, he spends most of his time reading and keeping tabs on exciting projects in the blockchain space. He also studies the ramifications of Web3 and blockchain development to have a stake in the future economy.

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