Javier Milei: An Anarcho-Capitalist Is The New President Of Argentina!
On Sunday November, 20th, 2023, Argentina decided to change.
Javier Milei is the new president with a disruptive agenda and the potential to alter the landscape of an economy ravaged by economic turmoil for more than two decades.
Milei is now the focus of attention as this is a rare occasion where a libertarian anarcho-capitalist leader assumes command of a nation.
He promised a shock therapy for the Argentinian economy, with the chainsaw becoming the symbol of his new policies.
The focus of this article lies not on Milei’s policies but on the possibility of cryptocurrency becoming widely accepted in Argentina.
Milei explains his vision:
The new Argentinian president talks the talk, but the difficult part is walking the walk.
Implementing disruptive changes requires strong public support.
Here is what Milei’s agenda suggests:
Supporting the business sector by lowering taxation, promoting privatization, and opening up the market with business-friendly legislation.
Restricting the government sector by eliminating ministries such as sports, culture, and education, which are deemed ineffective.
The approach is about reducing the national debt without hyperinflating the economy by excsessively printing new money. However, money itself is also where Milei will make disruptive changes:
Dismantling the Central Bank and dollarizing the Economy
More discussion is needed on a crucial matter. The Argentinian Peso has lost all credibility, with inflation levels soaring to 150% and ravaging the economy.
According to Milei his policies will ensure the reduction of inflation to 5% within two years, putting Argentina on the path to prosperity.
Despite claims by BTC maximalists, Milei has never mentioned BTC or any other cryptocurrency.
Replacing the peso with the dollar will most likely stabilize inflation. Yet, it is unlikely that this will be the solution to unlocking the full potential of the Argentinian economy.
Historic evidence from other dollarized economies suggests that a dollarized Argentina will most likely not assist Argentina but will help the dollar outsource inflation and support the US economy.
Plan B suggests the introduction of cryptocurrency as a parallel to whatever exists as a legal tender (peso or dollar).
Global commerce suffers today, with banks incapable of overcoming their decades-long fundamental flaws. The bankcard system worked well in the 70s and 80s, but Bitcoin renders it obsolete and cancels the tens of thousands of payment processors on top of the Visa/Mastercard payment networks.
Cryptocurrency sets commerce free to unleash its true potential and generate prosperity by making middlemen (trusted third parties) obsolete while empowering the individual in the process.
Which cryptocurrencies, though?
Those that work for commerce and everyday transactions. And this is clearly not BTC that is dysfunctional with high fees and congestion.
Bitcoin in the BTC version is incapable of offering financial freedom due to low capacity and inaction of its community to fix the gross scalability issues that begin with the 1MB blocksize limit and the solutions introduced (Segwit, LN, Liquid, etc).
Fees of BTC transactions are currently close to $30 per transaction. The LN solution demands opening a channel, which demands on-chain fees ($30) and can’t scale either without a significant increase (again) in the blocksize limit.
State-wide adoption would demand a cryptocurrency to include:
Decentralization (censorship resistance)
Scalability (ability to serve the needs of tens of millions of consumers)
Low fees (lower than a penny)
There are only a handful of cryptocurrencies that provide such features. The top two are:
Bitcoin Cash &
Decentralization can only be guaranteed by the proof-of-work protocol.
Hence, XRP and Nano are not appropriate. LTC and Dogecoin are similar to BTC in terms of scalability, therefore, do not present a viable solution
Maybe BTC maximalists want to promote their Centralized Lighting with censorable custodial wallets, but it is not the solution that guarantees financial freedom.
Freeing commerce should guarantee everyone has equal access to “freedom money” (decentralized cryptocurrencies), so these two cryptocurrencies are probably the only ones that achieve it to the maximum degree.
It is unlikely that Milei will adopt or consider any cryptocurrency for the first few years of his management of the economy.
However, it is important to note that a libertarian policy should allow and support a free market and freedom of personal finance.
Those cryptocurrencies that work efficiently will be a shining prospect, while those that rely on the SEC’s decision to approve Blackrock’s ETFs will most likely not achieve anything significant or positively disrupt finance and commerce in the long run.
If Milei genuinely believes in liberty, then the freedom of currency option should be acknowledged and protected by his presidency for the benefit of all Argentinians.
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