BUENOS AIRES - Argentina's political landscape has undergone a significant transformation with the election of Javier Milei, a staunch Bitcoin supporter, as the new president. Milei's victory, which saw him secure a commanding 55.7% of the vote on Sunday, comes amidst a backdrop of triple-digit inflation, escalating poverty, and looming recession fears in Argentina. His triumph triggered a substantial $13 million short liquidation in Bitcoin, highlighting the market's response to his proposed financial strategies.
Milei, who has been vocal about his support for various digital assets, including Ethereum, has faced scrutiny over his promotion of the CoinX scheme on Instagram. Despite this controversy, his economic blueprint has resonated with voters seeking change. His opponent, Sergio Massa, acknowledged Milei's victory in an election that unfolded against the canvas of a severe economic downturn and a stark poverty rate of 40%.
The president-elect is preparing to inherit an economy plagued by nearly 150% inflation and a currency that has plummeted approximately 90% in five years. He has laid out an aggressive plan aimed at overhauling the country's economy. Key to Milei's strategy is the abolition of the central bank and the removal of the Argentine peso to pave the way for full dollarization.
In addition to these radical changes, Milei intends to introduce austere measures as part of his administration's efforts to stabilize the economy. These include drastically cutting state expenditure and scrapping key ministries such as health and education. The previous interventionist government’s tactics of financing spending through printing money are seen as ineffective by analysts like SA analyst Shareholders Unite.
As Argentina braces for a new era under Milei's leadership Today, investors and citizens alike are watching closely to see how these ambitious reforms will unfold in a nation craving economic stability. Financial markets remain closed for National Sovereignty Day amidst these transitions.
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