Bitcoin Gains Legal Status for Contracts in Argentina

: Amidst a declining economy, Argentina turns to Bitcoin as a valid currency for contractual agreements.

Argentina’s Foreign Affairs Minister Diana Mondino has announced that Bitcoin will be legally recognized as a valid currency for contractual agreements in the country. This development comes amidst reports of a steady depreciation in the value of the Argentinian peso (ARS).

Mondino took to X (previously known as Twitter) to inform the public that Bitcoin can now be used for contractual transactions within Argentina. “In Argentina, we affirm and verify that contracts can be formulated in Bitcoin,” she stated. In addition, Mondino announced that other cryptocurrencies and even certain commodities, such as kilograms of beef or liters of milk, can be used in contracts.

On December 12, President Javier Milei announced a significant devaluation of the Argentinian peso (ARS), along with cuts in subsidies for energy and transportation. This decision will lead to a 50% devaluation of the Argentine peso, moving from 400 pesos per dollar to 800 pesos per dollar.

Luis Caputo, the Economy Minister, commented, “We’re going to be in a worse state for a few months.” He added that Argentina has a “dependency” on fiscal deficits. Meanwhile, Milei stated that the country lacked the time to explore other options.

Currently, Argentina is grappling with an annual inflation rate of 143%. The value of its currency has plummeted, and four out of ten Argentinians are living in poverty. Over the past decade, Argentina has averaged an annual inflation rate of 40%.

Over the past few months, Bitcoin has seen a substantial increase in its value. It has risen by approximately 65.57% in the last three months, with a notable 20.41% surge in the past 30 days.