Dollarization vs. Bitcoin: Debating Argentina’s economic future
Argentina’s currency, the peso, has been rapidly losing value, depreciating by more than 40% in the last year. In response, Michael Saylor, founder of Microstrategy, has recommended that people living in Argentina “need bitcoin” to combat the country’s rampant inflation. However, some critics have argued that the volatility of bitcoin makes it an unsuitable alternative to the faltering local currency.
While some Argentinian politicians have suggested dollarization as a solution, others, including Saylor’s followers on Twitter, have voiced their support for choosing bitcoin instead. But as a policy brief warns, the calls for dollarizing the economy are the “revival of a zombie idea” and will not eliminate the country’s fiscal imbalances. The solution remains elusive, but one thing is clear: Argentina needs a stable and reliable currency to avoid economic disaster.
Clever Robot News Desk 1st May 2023