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Argentina’s peso is collapsing again. Inflation, political drama, and investor panic have forced the US to step in.
Peso meltdown and Milei’s troubles
The peso lost 4.5% last week as doubts grew about President Javier Milei’s reforms. His party lost big in Buenos Aires elections. A corruption probe tied to his family added fuel to the fire.
Investors rushed out of Argentine markets. The central bank burned through $1.1 billion in three days to defend the peso. That’s painful when reserves sit at just $20 billion.
Bond prices tanked as Milei’s team spent cash faster than they could replace it.
Washington offers a lifeline
US Treasury Secretary Scott Bessent called Argentina a “systemically important ally.” He said all stabilization options are on the table.
Ideas include swap lines, currency buys, and even using a US fund to buy Argentina’s debt. His words lifted stocks for a day. The Merval index jumped 9% in dollar terms, but remains down almost 50% this year.
Bitcoiners call it a Ponzi
Economist Saifedean Ammous, author of The Bitcoin Standard, slammed Milei’s policies. He called them a “debt and inflation Ponzi.”
He noted Argentina had to offer 88% annual interest just to sell its latest bonds. Meanwhile, the government kept printing more pesos despite Milei’s libertarian image.
Inflation has dropped since Milei took office in late 2023, but it’s still brutal.
Crypto steps in
With the peso sliding between 948 and 1,475 per dollar, Argentines are shifting into stablecoins. Ignacio Gimenez from Lemon, a crypto app, said September 14 was its biggest day ever for stablecoin buys.
Stablecoins help locals hedge against peso collapse and are used for payments, remittances, and DeFi access. Bitcoin itself is also gaining fans as a store of value. Gimenez noted more Argentines now hold Bitcoin than stablecoins on Lemon.
