TL; DR
-
Argentina’s new president loves Bitcoin, which has driven the price of BTC up 3%, adding ~$22 billion in value to its market cap in 24 hours.
-
While 3% doesn’t seem like much, a 3% move in Bitcoin means ~$22 billion in new value (which is roughly Bitcoin’s entire market cap). Solana).
Full story
See that guy pictured above? Is he:
A) The bassist in your friend’s uncle’s band, who mainly does Bon Jovi covers, and still clings to the hope that they’ll make it one day…
Or
B) A high school guidance counselor who rides motorcycles and wears the same leather jacket every day (all in an attempt to be seen as “the cool teacher”)?
If you answered A or B, you are wrong. The correct answer was:
C) The new president of Argentina (seriously).
And he has some pretty wild ideas about central banks and the Argentine peso… specifically, he wants to get rid of both and dollarize the economy.
Translation: he wants to get rid of central banking in Argentina, and transition the local economy from using Argentine pesos to US dollars.
Wondering what this has to do with crypto?
If you’ve spent enough time in the space, you know that this kind of anti-central bank rhetoric usually goes hand in hand with a love for Bitcoin.
And Javier Milei (that’s his name by the way) is no different.
He hasn’t outright said he wants to make Bitcoin legal tender in the country, but it wouldn’t be shocking if that came up in future plans.
As a result: Bitcoin rose 3% in a 24-hour period.
That doesn’t sound like much, but a 3% increase in Bitcoin means ~$22 billion in new value (which is roughly Bitcoin’s entire market cap). Solana).
Okay, but why such extreme measures?
Well, the purchasing power of the Argentine peso has halved in the past year due to inflation… and the entire country’s GDP has barely doubled in the past hundred years.
All of which means:
Things (Argentine’s economy and financial system) haven’t been great → they’re getting worse now → given all this, the voting population is opting for what would previously have been considered an “extreme” economic solution.
Anyway, if our savings were to lose half their purchasing power within twelve months, we might be willing to cut our losses and embrace a foreign currency.
Who knows ¯\_(ツ)_/¯ hopefully we never have to find out.