Argentina is in the midst of its presidential election, and crypto fans have been paying particularly close attention to its current second-place candidate. On Sunday, the nation’s first round of general voting favored Sergio Massa (37%) over Javier Milei (30%) with the two men set to face one another in a runoff vote on November 19.
Milei has promised to overhaul the government and its fiscal and monetary policies. Among his more radical ideas is a promise to somehow end inflation as well as Argentina’s central bank.
Milei’s promises helped him pull off a surprise victory in his party’s primary election in August and his win became seen as a sign of widespread dissatisfaction with Argentina’s current Peronist government.
Milei is opinionated, far-right, pro-Bitcoin, pro-crypto, and once allegedly pro-Ponzi. By late Sunday evening, Milei went to bed with a tentative 29.9% of votes, trailing the incumbent Peronist party’s finance minister Sergio Massa with 36.6%. Overnight, the final 1% of votes cut Massa’s lead to 37%.
A former security minister, Patricia Bullrich, placed third with 23.8% of votes. She will not contend in November’s runoff election.
Sergio Massa, Javier Milei to face off November 19
In Argentina, voters don’t elect a president by simple majority. Instead, the country requires a candidate to either earn more than 45% of the popular vote or earn 40% if they gain a lead of more than 10% over their closest opponent.
Massa’s 37% and mere 7% lead over his closest rival means that he failed to hit that bar in October’s general vote. As a result, Massa and Milei will continue campaigning until another, hopefully, more decisive vote on November 19.
Ever confident, Milei displayed few signs of discouragement during Sunday’s vote tally. He told supporters that advancing to a runoff represented a “historic achievement” for his relatively new party, La Libertad Avanza. His party competes with successors of Juan and Evita Perón who have controlled Argentina’s government since the 1970s.
Milei: pro-bitcoin, pro-crypto, pro-dollar, and pro-CoinX
As far as Bitcoin is concerned, Milei sometimes speaks positively about Satoshi Nakamoto’s creation, saying Bitcoin “represents the return of money to its original creator, the private sector.” Yet he’s demonstrated more caution than El Salvador’s Bitcoin-loving ruler Nayib Bukele. Whereas Bukele made bitcoin legal tender, Milei has no such aspirations. Instead, he wants to replace the Argentinian Peso with the US dollar which would increase the power of the Federal Reserve and the Bank of International Settlements.
Milei has also promoted Ethereum in the past, as well as questionable digital asset platforms. As Protos previously reported, some Argentine victims of the CoinX pyramid scheme sued Milei for his role in promoting it. Argentinian authorities censured CoinX for failing to deliver its promised returns.
Prior to and separate from Milei’s candidacy, Argentines were already turning to digital assets like bitcoin and stablecoins to hedge against runaway inflation. Official inflation metrics topped 138% over the past year and the real, blue dollar inflation rate available to everyday consumers soared even higher. Many Argentines have never thought of crypto as an investment, rather it’s simply a way to sell pesos for something that hopefully stores its value for a while longer than Peronist fiat.
Market reaction to Sunday’s vote
Massa’s quasi-victory — i.e. winning the top contender spot against Milei in November — might have hinted to many financial market participants that the government will demonstrate ‘more of the same’ fiscal policies.
- Specifically, blue dollar rates strengthened from a 1,200 pesos per USD midpoint on Saturday to 1,050 on Monday.
- Official currency peso/USD exchange rates controlled by the Peronist government, which garner minimal volume, remained unchanged.
- Shares of an ETF that tracks the MSCI Argentina Index dropped 4% from a Friday high of $40.50 to $38.89 at Monday’s close of trading.
In short, Milei’s La Libertad Avanza will face the incumbent Peronist party in a November 19 presidential election. Regardless of one’s viewpoint, crypto markets will certainly view the outcome with interest, but Milei’s promotion of CoinX and dollarization should certainly temper any Bitcoiner enthusiasm.