The President of Argentina is open to Bitcoin and CBDC, but the Central Bank says that it does not

Argentine President Alberto Fernandez has expressed support for digital assets, claiming that there is no reason to oppose emerging asset classes.

On August 12, Fernandez was interviewed by the local media Caja Negra Responded Regarding the question of whether he will consider exploring the central bank digital currency (CBDC), even Recognize Bitcoin as legal tender As El Salvador did earlier this year.

“I don’t want to go too far physically […] But there is no reason to say’no’,” Fernando said, adding: “They say the advantage of doing this is that the inflation effect is largely offset. ”

Inflation is a decisive issue for the government of former Argentine president and businessman Mauricio Macri (Mauricio Macri). According to government data, Macri’s 100 Argentine pesos when he resigned in 2019 is equivalent to today’s 661 pesos.

Despite Argentina’s strict currency control, the current president pointed out that there is a growing belief that Bitcoin can hedge against inflation in the broader global economy. However, Fernandez is also careful to point out that the cryptocurrency field is still in its early stages:

“The reason for caution is how strange it is, and because it is difficult to understand how this wealth is realized. Many people in the world have these concerns, which is why the project or system has not been expanded yet. [more than it has]. But this is something to consider. “

Although the president is open to exploring digital assets, Argentine central bank governor Miguel Pez appears to be threatening to crack down on the industry.

Speaking During the Digital Finance Forum of the Argentine Institute of Financial Executives on August 10, Pesce targeted cryptocurrencies, described digital assets as a threat to economic stability, and heralded stricter regulation of the industry.

During the event, Pesce asserted that BTC failed to create value for investors outside of the short-term hype cycle. The governor of the central bank also compared Bitcoin to a commodity and concluded that BTC is “not a financial asset as defined by the country’s National Securities Commission.”

Pesce stated that he intends to “regulate the intersection of Bitcoin, payment systems and trading markets,” and warned that this cryptocurrency “may be very harmful to domestic financial stability.”

When regulating the industry, the central bank hopes to give priority to “preventing low-level investors” from participating in encrypted assets, Pesce said:

“We are worried that (cryptocurrency) will be used to create illegitimate profits for unsuspecting people.”

Pez also refuted Argentina’s proposal to explore a central bank digital currency (CBDC).

Related: Report: In the callback, Argentine Bitcoin miners flourish

In May, it was reported that Retail cryptocurrency mining is booming in Argentina Because citizens want to take advantage of cheap electricity and soaring cryptocurrency prices. In the same month, the Central Bank reiterated its warning to the Argentines about the risks associated with crypto assets.

Last month, the Canadian mining company Bitfarms proposed a roadmap for expansion in Argentina. It is estimated that its upcoming Argentine factory will be Reduce production costs by 45%.