The Government of Argentina imposes capital controls on its citizens in response to increasing financial problems for the country. The South American country has limited purchases of dollars to just $ 10,000 a month, after $ 3 billion was depleted from its foreign exchange reserves on Thursday and Friday alone. Is it time to switch to bitcoin?
Argentina on the brink of default
Argentina's national currency, the peso, has been in freefall for the past few weeks as the government tries to pay off its short-term debt. In the last month alone, the peso has fallen by more than 25%. Interest rates have risen sharply as the Argentine central bank tried to control its debt by deciding Wednesday to delay payments of $ 7 billion in debt this year.
The decision comes from President Mauricio, who is running on a promise to get rid of state intervention in the economy. Now it is doubling its ideals by imposing currency controls. Argentina's current political landscape suggests that Mauricio and his party will lose power in the upcoming October elections. This fact scares many investors in the country.
The opposition calls for currency controls, claiming the government is in "virtual default". Central Bank Reserves Fallen Nearly $ 12 Billion Due to Political Uncertainty  Bitcoin as a Safe haven
One of the most attractive aspects of Bitcoin is the fact that it is not controlled by any country. Traditional fiat currencies are state-controlled, allowing them full control of the country's monetary policy. They can adjust inflation rates, change interest rates and, in this case, apply currency controls to tell their citizens what they can or cannot do with their money.
 If the peso continues to decline, we may see another fiat currency undergo hyperinflation. Citizens will continue to lose confidence in their national currency and look for other alternatives. And if those restrictions remain in place or get worse, the dollar will not be an option.
Bitcoin and other cryptocurrencies may be the safe haven that Argentinian people need, as they face this economic uncertainty. A lot of fallen currency will not be accepted by many people as there is no guarantee that it will not cost anything the next day. Bitcoin could fill the void as people face more and more difficulties trying to secure their wealth.
What do you think about Argentina's new policy? Maybe Bitcoin helps its citizens? Let us know in the comments below!
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