Bitcoin Now Legally Accepted in Contracts in Argentina

Argentina has taken a significant step toward embracing cryptocurrencies, particularly Bitcoin, as it formalizes the use of digital assets in official contracts. The country’s Minister of Foreign Affairs, Diana Mondino, confirmed this groundbreaking move, indicating that Bitcoin can be used as a legally accepted currency for entering contractual agreements within Argentina. The announcement follows a recent economic decree, the “Bases for the Reconstruction of the Argentine Economy,” passed on December 20, which, while not explicitly mentioning crypto, laid the groundwork for the acceptance of alternative currencies in transactions.

This move towards recognizing Bitcoin in contracts aligns with the broader economic reforms and deregulation efforts led by Argentina’s newly-elected President, Javier Milei. The president, known for his pro-crypto stance, views Bitcoin as a crucial tool to counter the inefficiencies and corruptions of centralized financial systems, especially in the face of severe issues such as hyperinflation and currency devaluation within the country.

Diana Mondino’s affirmation that contracts can be settled in Bitcoin and “any other kind of crypto” adds a unique dimension to Argentina’s approach. Notably, the economic decree provides individuals with the freedom to choose the type of currency for bond or security deposit transactions, extending to foreign currencies and leaving the door open for crypto usage without explicit denial.

The positive response from the crypto community comes in the wake of Argentina’s recent economic challenges, including a significant devaluation of the national currency by over 50%. This economic shock therapy, part of President Milei’s larger plan for reform, seeks to return freedom and autonomy to individuals by dismantling regulations that hinder economic growth.

The potential impact of Argentina formally approving Bitcoin for contracts could extend beyond its borders. Some experts believe that if South America’s second-largest economy adopts Bitcoin more widely, it could catalyze the global use of cryptocurrencies. Argentina, grappling with inflation and financial instability, has become one of the most active communities in blockchain in Latin America, according to blockchain analytics firm Chainalysis.

While the specifics of any new measures related to crypto were not provided in the announcement, the ratification of Bitcoin for contracts is seen as a significant first step. The move indicates a shift in how developing economies like Argentina perceive and utilize digital currencies. As the nation explores the opportunities presented by crypto-friendly policies, it remains to be seen how this evolution will impact Argentina’s economic landscape and potentially influence global cryptocurrency adoption.