Javier Milei’s Victory: Argentina Crypto Faces Crucial Crossroads After LLA Midterm Wins

For many in the digital asset space, the political landscape of Argentina has been a beacon of hope. President Javier Milei, a vocal advocate for cryptocurrencies, has consistently championed Bitcoin as a potential solution for the nation’s economic challenges. However, his party’s recent victory in the LLA midterms presents a complex picture for the future of Argentina crypto, signaling both potential and significant hurdles. This comprehensive analysis delves into the nuanced reality behind the headlines, exploring why Milei’s rhetoric has not yet translated into a clear path for crypto adoption.

Javier Milei: Rhetoric Versus Reality for Crypto

President Javier Milei has long captured the attention of the crypto community. His outspoken criticism of central banks, famously calling them ‘a scam,’ resonated deeply. Furthermore, he has described Bitcoin (BTC) as ‘the natural reaction against the central bank scammers,’ a sentiment widely applauded by digital asset enthusiasts. Milei, an economist-turned-president, has publicly asserted that cryptocurrencies can effectively address some of Argentina’s persistent economic problems. He once declared, ‘There will be free competition of currencies, so if you want to use Bitcoin, there will be no problems.’ Such statements naturally foster optimism.

Despite this unambiguously pro-crypto rhetoric, Milei’s actual progress on a concrete pro-crypto agenda remains limited. The initial enthusiasm from the crypto community has, therefore, begun to temper with a dose of reality. Observers note a significant gap between his powerful public statements and the tangible legislative or regulatory actions taken during his presidency. Understanding this disparity is crucial for anyone following the trajectory of crypto in Argentina.

Milei’s journey into the political spotlight began with a distinct flair. In 2019, while a television personality and author, he famously appeared at the Buenos Aires Comic-Con dressed as ‘General Ancap.’ This anarcho-capitalist ‘superhero’ persona, known for deriding Keynesian economics and collectivism, embodied an irreverence that has characterized his subsequent political career. This early public image established his libertarian credentials, which naturally aligned with the decentralized ethos of cryptocurrencies.

From playing a libertarian superhero to famously gifting Elon Musk a chainsaw symbolizing austerity, Milei’s controversial economic policies have undeniably endeared him to many in the crypto industry. Leading up to his 2023 victory and shortly thereafter, Milei continued to make several pro-crypto pronouncements. However, when it came to translating these pronouncements into actionable policy, progress has been slow and often contradictory. This divergence between word and deed forms the core of the current uncertainty surrounding Argentina crypto.

Legislative Hurdles and Emerging Cryptocurrency Regulation

The legislative process has presented significant obstacles to a straightforward pro-crypto agenda. When the legislature considered the expansive Law of Bases and Starting Points for the Freedom of Argentines, it ultimately decided to omit a crucial provision intended to benefit crypto investors. Specifically, legislators cut a portion of the omnibus bill that would have levied a one-time regularization tax on cryptocurrencies. This provision aimed to kickstart Milei’s presidency with a clear signal of crypto integration. However, the minister of interior explained that they scrapped the amendment to avoid delaying the broader bill, highlighting the complexities of political maneuvering.

Moreover, the government has introduced new frameworks for virtual asset service providers (VASPs). In March, Law N°27,739 was passed, significantly altering the regulatory landscape. Previously, the National Securities Commission adopted a lenient approach, often not requiring registration or enforcing securities laws on crypto issuers, exchanges, and other providers. This new law changes that dynamic considerably. Now, VASPs must report and actively monitor illicit activity under strict Anti-Money Laundering (AML) measures. This move towards increased oversight, while potentially beneficial for market integrity, also signals a shift from the hands-off approach many in the crypto community initially hoped for under Milei.

This evolving cryptocurrency regulation indicates a pragmatic approach from the government, prioritizing financial stability and international compliance. While not explicitly anti-crypto, these measures introduce stricter requirements that VASPs must navigate. The challenge lies in balancing these regulatory necessities with the president’s stated goals of fostering a free and open environment for digital assets. The crypto industry must adapt to these new realities, which could impact operational costs and market entry for new players.

The Knowledge Gap in Bitcoin Policy

A significant challenge impacting the development of a clear Bitcoin policy in Argentina is a perceived knowledge gap within government circles. Carlos Maslatón, a prominent Argentine financial analyst, Bitcoin maximalist, and lawyer, shared his insights on this issue. He recounted speaking with Milei ‘extensively about Bitcoin in 2013 or 2014, and he attentively listened to what I had to say. But the truth is, I don’t think he was able to grasp its essence totally.’ This observation suggests that while Milei may be open to the concept, a deep understanding of the technology’s intricacies might be lacking at the highest levels.

Further reinforcing this concern, Ramiro Marra, a current member of the Buenos Aires city government and a former member of the LLA, expressed similar frustrations. He stated, ‘I can’t find anyone who knows anything about [crypto]. Or rather, almost all of them are inexperienced, and I hope they don’t discuss any kind of law on this topic because they have no idea. That’s why I think talking about regulations is a very serious risk, because you put it in the hands of people who are completely ignorant.’ Such candid remarks highlight a critical hurdle: effective policy formulation requires informed decision-makers.

This knowledge deficit creates a substantial risk. Without a thorough understanding of blockchain technology, its potential benefits, and its inherent risks, any attempts at cryptocurrency regulation could inadvertently stifle innovation or create unintended negative consequences. The crypto community in Argentina faces the task of educating policymakers to ensure that future legislative efforts are both informed and constructive. This educational effort is paramount for fostering a truly supportive environment for digital assets.

The Libra Memecoin Scandal and Political Entanglements

Milei’s nominal openness to cryptocurrencies became complicated by the ‘Libra’ memecoin scandal in February. Initially advertised as a means to fund Argentine entrepreneurs and spur economic development, the token’s price experienced a meteoric rise before crashing dramatically after Milei posted about it on X. This incident, often referred to as ‘Libragate,’ quickly escalated into a public and political controversy. Related: The Milei ‘Libragate’ debacle took months to develop, days to unfold.

The ensuing scandal, which even drew in Barstool Sports founder David Portnoy, sparked official investigations into Milei’s involvement. In April, the Chamber of Deputies, Argentina’s lower house of legislature, approved a probe into Libra. While the probe did not directly implicate Milei, the main opposition group, the Union for the Homeland (UxP), called for articles of impeachment to be opened against him. Their request was ultimately declined. By May 20, Milei dissolved the investigative task force, claiming it had completed its mandate and found no wrongdoing by the president. Milei publicly denied any fault, asserting he didn’t promote the project but merely ‘shared’ it. He also downplayed the impact on Argentinian investors, noting that most who lost money were Chinese or American, stating, ‘Did Argentinians lose money? Four or five at most.’

This incident undoubtedly cast a shadow over the government’s engagement with crypto. It highlighted the risks associated with volatile digital assets and the potential for public figures to inadvertently influence market dynamics. The scandal serves as a cautionary tale, emphasizing the need for clear guidelines and ethical considerations when public officials interact with the crypto space, especially concerning nascent and speculative assets like memecoins. It complicates the narrative around Javier Milei as a purely pro-crypto leader.

LLA Midterms: Mandate Amidst Austerity and External Influence

Beyond the memecoin scandal, Milei has contended with limited policy success and growing public discontent. While his administration has achieved some success in reducing inflation, Argentines have frequently taken to the streets to protest his severe austerity policies. Police responses to these protests have raised concerns among human rights organizations about increasing repression. Against this backdrop, the LLA midterms victory was particularly surprising, given Milei’s low approval ratings preceding the elections.

Three separate polls indicated Milei’s approval ratings hovering around or even below 40%. Source: AS/COA. Gustavo Cordoba, director of the Argentine polling firm Zuban Cordoba, suggested that Argentines might have been motivated to grant the LLA a second chance, driven by a desire to avoid another economic crisis. He noted, ‘Many people were willing to give the government another chance … We’ll see how much time Argentine society gives the Argentine government. But the triumph is unobjectionable, unquestionable.’ Gonzalo Roca, the LLA’s main candidate in Cordoba, echoed this sentiment, stating, ‘We cannot solve all the problems that the country has had for 100 years in two years,’ and added that the country was on the ‘right path.’

Another significant factor influencing the elections was the possible effect of US President Donald Trump’s $40-billion economic stimulus package. Trump very publicly made this package conditional on the LLA’s performance in the midterms. Trump: “In Argentina, I want to congratulate the victor. And he had a lot of help from us.” pic.twitter.com/vG3pamNuEe— Aaron Rupar (@atrupar) October 27, 2025. Peronist Itai Hagman critically called this ‘clear interference in the internal affairs of another country.’ Ahead of the vote, Hagman predicted Argentines would ‘defend their sovereignty and their democracy. They will not vote based on what the president of another country tells them, but on their own interests and will.’ However, whether voters chose LLA to avoid another government shakeup or to secure the US lifeline, Hagman’s prediction proved incorrect. With the recent LLA victories, Milei now possesses a broader mandate to pursue his political agenda, which could potentially impact Bitcoin policy and broader cryptocurrency regulation.

The Future of Argentina Crypto: A Path Forward?

The recent LLA midterms victory provides Javier Milei with a reinforced mandate. This political momentum could empower him to push through more of his economic reforms, potentially including aspects that could benefit Argentina crypto. However, the path remains fraught with complexities. The government must reconcile Milei’s libertarian rhetoric with the practicalities of governance, including international financial obligations and domestic economic stability. The challenge lies in crafting policies that genuinely foster innovation while safeguarding against financial risks and illicit activities. The crypto community eagerly watches to see if this renewed political capital will translate into concrete, supportive legislation for digital assets.

The development of a robust and clear Bitcoin policy requires overcoming the existing knowledge gap within the government. Education and collaboration between crypto experts and policymakers will be essential to ensure that any new regulations are well-informed and beneficial. Furthermore, the lessons from the Libra memecoin scandal highlight the importance of transparency and careful engagement by public officials with speculative digital assets. Moving forward, the balance between fostering a free market for cryptocurrencies and implementing responsible regulatory frameworks will define Argentina’s trajectory in the global crypto landscape. The potential for Argentina to become a leader in crypto adoption is still present, but it demands strategic and informed action.