The Minister of Economy and presidential candidate, Sergio Massaannounced the creation of a virtual weight, possibly on the blockchain: the Argentine Digital Currency (MDA). In addition, he stated that the cryptocurrency “will offer a tax reduction for those who use it in their economic operations, as a way to promote formality in transactions.”
The MDA It is a central bank digital currency (CBDC, for its acronym in English). Are They emerged in response to the rise of Bitcoin and other cryptocurrencies. Countries such as the United States, China, Switzerland and Russia They have already advanced in their development.
Massa’s announcement generated a intense debate about the feasibility of creating a virtual peso. In this sense, there is a wide spectrum of opinions about these cryptocurrencies and their effects, not only on the privacy and security of citizens, but on the main economic variables of the country.
Some experts maintain that, If the MDA is used incorrectly, State control can become so strong that it threatens to completely paralyze economic activity in Argentina..
Those who take a dim view of these cryptocurrencies warn that governments seek completely replace the use of cash to track and tax every transaction automatically, devalue the peso to your liking and piacere –the costs of printing and distributing the currency are eliminated– and even block or freeze funds without the need for intermediaries such as banksdirectly from the Central Bank of the Argentine Republic (BCRA)in an automated way with software. They can also raise taxes automatically.
They warn that suppressing the use of cash could put the Argentine economy at risk because Many companies and people survive because they operate outside of current fiscal and tax regulations.. If even more taxes are charged, These businesses could go bankrupt and lose jobs.. At the same time, there is a possibility that Foreign companies decide to close their doors in Argentina due to stricter tax burdens and regulations compared to other countries.
At the opposite extreme, there are those who argue that CBDCs can be an extremely effective tool to eliminate organized crimeAs the trafficking in people, organs, weapons and drugsin addition to blocking the support for terrorist groups. This is because, by granting the State extreme control over transactions, it is much easier to track those who participate in these financial crimes.
Specialists who support the use of these digital currencies maintain that the Cryptocurrencies like Bitcoin, although they offer freedom to the individual to manage their money without government intervention, also give these same powers to criminal organizations. to remain anonymous, away from state regulations. On the contrary, Since CBDCs are controlled by the State, this type of crime can be unmasked.
Another advantage that they list of the CBDC the thing is reduce the costs of each transactionto the eliminate banking intermediaries, such as Visa or Mastercard, who charge commissions. Thus, operations are executed more efficiently and directly.
In the Stanford University I also trained in topics related to economy and businessand I did a postgraduate degree in cognitive sciences. That is why I believe in blockchain-based solutions to solve the most important problems affecting humanity. The adoption of the virtual peso undoubtedly represents a crucial point in the evolution of financial technology in Argentina. However, This can be a viable option only if implemented responsibly.. For this, it is essential that any transition to a digital currency is supported by a project that promotes competitiveness and sustainable growth of the Argentine economy, avoiding alienating foreign investors and ensuring that taxes are not so high that they make business in the country unviable.
Lucas Roitman is a Researcher at Apple and Stanford, CEO of FreeWillAI
by Lucas Roitman
