The warning from the Central Bank is not of a normative kind. Bitcoiners responded massively to the Central Bank and highlighted that the problem relies on the pesos.
The Central Bank of the Argentine Republic alerted the citizens of that nation that it considers the use of bitcoin (BTC) and cryptocurrencies to be a potential risk for the nation. It did so two days after Banco Galicia and Burbank started bringing investments with these financial items on their networks.
The communication from the BCRA happened around noon this Wednesday, May 4, through two tweets on the entity’s official account. In the first of them, a prudent stance to mitigate a possible set of vulnerabilities for users and investors got highly recommended.
In the second tweet, the Central Bank highlighted the reason for its fear. As they explain, crypto-assets show some challenges for their users, investors, and the financial structure in general. They add that the speed of development and the growing interest make it necessary to show a conservative attitude.
The first tweets came with a link to a statement that the BCRA revealed in May 2022. It exposes seven factors that the agency sees as risky in digital assets: they are not legal tender in Argentina; they present prominent volatility; these items are vulnerable to operational disruptions and attacks; digital assets lack safeguard; they don’t have enough transparency; allow to be helpful to launder money, and their transactions may be cross-border.
In the messages from the Central Bank of Argentina, there are zero references to the inclusion of investments with bitcoin in Banco Galicia and Burbank. The news got revealed just two days after the aforementioned private banks released their new service with digital assets.
Bitcoiners Responded that the Problem is the Pesos
The recent BCRA tweets became viral and received many responses from bitcoiners and others who stand for the free choice of currency. For example, the Twitter account of “La Libertad Avanza,” a political space to which the libertarian deputy, Javier Milei, belongs, got replied with an emoji.
Several tweeters argued that the struggle does not rely on bitcoin or digital assets but pesos, the national currency of Argentina.
Also, on Twitter, history professor Pablo Báez commented that, despite everything, it seems that bitcoin presented less risk than the peso and highlighted some features of that fiat currency like not getting accepted outside the nation, its high volatility, and the lack of transparency.
In terms of value reserves, effectively keeping savings in Argentine pesos has been a bad idea. While the national currency is constantly depreciating and has lost more than 95% of its value in the last ten years, bitcoin has proven to be a better option in the long term, beyond its high volatility in short periods, as seen in the graph above.
By: Jenson Nuñez
