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October 24, 2023

The Path to a Digital Peso: Argentina's CBDC on the Horizon

Argentina's economic landscape has been abuzz with discussions surrounding the country's potential CBDC

In recent times, there has been much talk about Argentina's potential Central Bank Digital Currency (CBDC), fueled by a suggestion from Economic Minister Sergio Massa on utilizing this technology to foster fiscal growth.

Now, the Central Bank of Argentina is making its intentions clear by revealing plans to expedite the implementation of the digital currency and push for the necessary legislation "as soon as possible." Juan Agustín D’Attellis Noguera, the bank's director, made this announcement, stating that work is already underway on the legislative framework for the digital peso.

Noguera, an ardent supporter of the CBDC concept from its inception, expressed his eagerness for every phase of its rollout. He mentioned that the framework would be presented to Argentina's legislature, known as the Congreso de la Nación Argentina, as soon as it's ready.

During his public address to local news media, Filo, Noguera commended Massa's approach to tackling the country's current economic challenges. He took the opportunity to contrast this approach with alternatives such as the use of private cryptocurrencies and dollarization of the economy.

Noguera sees the digital peso as a tool for improving tax collection, as its traceability will help expand the tax base. By tracking digital currency transactions where the parties involved are known, the government can potentially increase tax revenues without raising tax rates or even lower them.

The decision to move towards a digital peso comes at a critical time for Argentina, with skyrocketing inflation rates and a tumultuous economic landscape. The political arena is abuzz with discussions on how to address these challenges and promote economic growth.

Javier Milei, a leading opposition candidate and a proponent of Bitcoin, places blame on politicians and the central bank for the country's financial difficulties. Milei has even called for the dissolution of the top bank in Argentina. Argentina currently ranks third in global inflation rates, and Milei's stance against traditional approaches has made him a key figure in the national debate.

On the other hand, Sergio Massa, the Economic Minister and Milei's primary opponent, stands firmly against any moves toward dollarization of the economy. He positions the CBDC as a promising solution, saying, "We are going to launch the digital currency in Argentina. We are going to do it globally for all of Argentina accompanied by a laundering law that allows those who have money abroad to bring it and use it freely without new taxes in parallel."

With these dynamics at play, Argentina's journey toward a digital peso is poised to reshape the nation's financial landscape, offering potential solutions to pressing economic issues. As the Central Bank of Argentina pursues this ambitious endeavor, the world will be watching to see how it unfolds.

Josefina Dipaolo
Josefina Dipaolo
Content Writer at TechNews180
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