The Argentine government has introduced capital controls on its citizens in response to growing economic questions for the country. The South American country has limited dollar purchases to just $ 10,000 per month after $ 3 billion was withdrawn from their foreign exchange reserves on Thursday and Friday alone. Is it time to switch to Bitcoin?
Argentina On Brink of Default
Argentina's national currency, the peso, has been in free fall in recent weeks as the government tries to pay down its short-term debt. The peso is over 25% just in the last month. Interest rates rose sharply as the Argentine central bank tried to control its debt and made the decision on Wednesday to defer payments of $ 7 billion in debt this year.
The decision comes from President Mauricio, who ran on promises to get rid of government intervention in the economy. He is now doubling back on his ideals by introducing currency controls. The current political landscape in Argentina suggests that Mauricio and his party will lose power in the upcoming October elections. This fact scares many investors in the country.
The opposition has called for currency control, claiming that the government was in a "virtual standard." The central bank's reserves fell nearly $ 12 billion due to political uncertainty  Bitcoin as a safe haven
One of Bitcoin's most attractive aspects is the fact that it is not controlled by any party. Traditional fiat currencies are controlled by the state, giving them full control over the country's monetary policy. They can adjust inflation, change interest rates, and in this case specifically, conduct currency checks to tell their citizens what they can or can't do with their money.
 If the peso continues to fall, we may see another fiat currency under hyperinflation. Citizens will continue to lose confidence in their state currency and look for other alternatives. And if these restrictions stay in place or get worse, the dollar will not be an option.
Bitcoin and other cryptocurrencies can be the safe haven needed by the Argentine people as they face this financial uncertainty. A falling currency will not be accepted by very many people, as there is no guarantee that it will be worth anything the next day. Bitcoin could fill the void as people face more and more difficulties in trying to secure their wealth.
What do you think of Argentina's new policy? Could Bitcoin help its residents? Let us know in the comments below!
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