- Sweeping reforms in Argentina leads to contract deregulation.
- Contracts can now be paid whatever the parties agree upon, including Bitcoin.
- A Rosario landlord signs a Bitcoin rental agreement.
Due to Bitcoin’s wild volatility , it is often touted as a store of value rather than a medium of exchange. However, the medium of exchange use case may still have a valid shout as sweeping reforms by Argentina’s newly elected president , Javier Milei, give rise to the country’s first rental agreement denominated in Bitcoin.
Argentina’s First Bitcoin Rent Contract
According to the local news outlet Pagina 12, the landlord of an apartment in Rosario, a city in Santa Fe province located 180 miles northwest of Buenos Aires, has signed a rental agreement stipulating payment in Bitcoin . This marks the first such agreement in Argentina, per finance company Fiwind.
The tenant must pay 100 USDT to Fiwind each month, who are then tasked with converting the proceeds into Bitcoin and forwarding the payment to the landlord. According to Pagina 12, Fiwind’s facilitation of this deal is at “no cost.”
Based on the current spot Bitcoin price at the time of writing, 100 USDT converts to 0.00234 BTC. An upward move in the price of Bitcoin would mean the landlord receives less BTC, highlighting the difficulties of accepting payment in cryptocurrency when goods and services are priced in fiat (or fiat equivalent in this case).
Despite that, this landmark agreement was made possible by a wave of deregulation enacted by President Milei, who intends to tackle the country’s ailing economy using a radical approach to policy.
Do You Accept Payment in Milk and Beef?
Part of President Milei’s radical policy approach to overhauling Argentina’s economy was a decree that parties to a contract can agree to payment in peso, foreign currency, and Bitcoin if they choose. The policy extends to anything considered a designated payment method, with foreign affairs minister Diana Mondino giving kilograms of beef and liters of milk as examples.
“Art 766. - Obligation of the debtor. The debtor must deliver the corresponding amount of the designated currency, whether the currency is legal tender in the Republic or not,” tweeted Mondino .While liberals have celebrated Milei’s progressive approach, some Argentinians have protested the use of emergency decrees to circumvent the congressional system. This sentiment spilled into the streets of Buenos Aires in December 2023, with thousands of protestors marching to ease the “austerity measures” brought about by Milei’s intention to open up the economy to free market ideals.
On the Flipside
- Milei’s policies aim to break down socialist systems and increase market-driven efficiencies. He believes this is the optimal way to lower inflation, which came in at 161% in November 2023 .
- The Rosario rental agreement involves a third party, countering Bitcoin’s peer-to-peer philosophy.
- Companies such as Bitrefill offer an app service for Bitcoiners to pay for living expenses , enabling them to live solely on crypto.
Why This Matters
While a small development, the Rosario rental deal signals a meaningful change in Argentina. By aligning business incentives around technology guaranteed by code, not lawmakers, Argentina moves one step closer to enabling a digital asset economy. If digital assets take root, real autonomy may follow.
