Argentina's Debt Risks Collapse, Bitcoin Seen as Escape

Argentina’s Debt Spiral Risks Collapse, Bitcoin Seen as Escape

Written by Aaron S.,

Editor-In-Chief

Last Updated: September 17, 2025

Key Takeaways

Argentina’s bond-driven strategy relies on printing money, which worsens inflation and risks a collapse if the peso weakens too fast;
Economist Saifedean Ammous warned that the high-yield bond cycle is unsustainable and could trigger a rush to safer assets like Bitcoin;
Ammous said keeping the central bank undermines reform efforts, and ending the debt cycle is necessary to prevent further economic harm.

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Argentina’s financial strategy is under scrutiny, with Saifedean Ammous, author of The Bitcoin Standard, warning that the country’s current system may be heading toward collapse.

He described the approach as a risky cycle of debt and inflation, driven by high-yield government bonds and the constant creation of money.

Ammous shared in a post on X that under President Javier Milei, Argentina has leaned on a cycle where the government offers high-interest bonds to attract investment.

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This practice, referred to locally as "la bicicleta financiera", allows investors to earn more than the rate at which the peso is losing value. However, to continue paying these high returns, the government must print more money, which leads to further devaluation of the peso.

He pointed out that this cycle cannot continue forever. If the peso drops faster than the bond returns, investors may quickly sell off their bonds and switch to more stable assets, such as the US dollar or Bitcoin BTC $112,462.78 .

Ammous criticized the government’s decision to keep the central bank running. He argued that ending this cycle is not a matter of ideology but a necessary step to stop further economic damage.

According to him, continuing down this path only increases the risks, and for many, switching to Bitcoin may be the most reliable way out.

Meanwhile, the US House of Representatives' proposal called on the Treasury Department to explain what it would take to manage a national Bitcoin reserve. What does it cover? Read the full story.