The situation in the American continent regarding cryptocurrency is different between two countries, Argentina and El Salvador. While Argentina had to accept a clause by the International Monetary Fund (IMF) in a $45 billion bailout that discourages the use of cryptocerency, El Salvador made the opposite decision - adopting Bitcoin as a legal tender. Which of the two countries did better? To answer this question, we have to look at the outcomes of each economic policy.

In the case of Argentina, the IMF's anti-crypto clause was responsible for a steady inflation rate increase during the past year. It rose from a very high 52.3% in March of 2022 to a staggering 104.3% this past March. The currency devaluation left Argentinian citizens powerless against their government, unable to protect themselves from the loss of their purchasing power.

El Salvador was initially met with skepticism and large scale protests when it declared Bitcoin as legal tender. The IMF was also disapproving, warning President Nayib Bukele of the risks that Bitcoin could bring to the country and hindering further financial aid. Nonetheless, El Salvador proceeded with the policy. Over the course of the last year, El Salvador experienced positive growth in its Gross Domestic Product (GDP) and its homicide rate decreased significantly. Moreover, citizens abroad can now easily send money home at lower costs than through traditional services like Western Union. Although El Salvador's current Bitcoin holdings are in the red, their value is expected to increase significantly due to Bitcoin’s halving cycles.

The comparison between Argentina and El Salvador shows us that taking a chance on cryptocurrency can pay off. Despite initial risks, El Salvador's economy is more stable and its citizens have more economic security than their Argentinian counterparts. It seems this different economic policy was beneficial for El Salvador, but only time will tell if it lasts.



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