Milei’s government will not force dollarization.
“People who make transactions in the currency they want,” says Javier Milei.
Dollarization (or, more precisely, free currency competition), was at the heart of the economic proposal that catapulted Javier Milei to the presidency of Argentina in the November 2023 elections.
Two and a half years later, The Argentine peso remains the legal tender. And the explanation given by the president himself on April 8, 2026, in a interview broadcast by Public Television, is striking. «Do you know what the main problem is why you cannot dollarize? “That people don’t want to dollarize,” he stated.
Milei added: «We have proposed endogenous dollarization. That is, if you want you can make your transactions in dollars and yet people do not do it. “We have sanctioned fiscal innocence and yet people do not do it.”
The law of fiscal innocenceregulated in February 2026—restored the presumption of innocence in tax matters and made it possible to operate in dollars without legal consequences. The door, according to Milei, is already open. But Argentines, in their daily behavior, continue to choose the peso. And that decision, for the president, is sovereign.
Strictly speaking, you cannot impose things by force on people. And if you gave him the option to use dollars and he continues using pesos, OK… let people make transactions in the currency they want.
Javier Milei, president of Argentina.
When asked if dollarization would not have shielded the economic program from turbulence, Milei acknowledged that there are technical obstacles—insufficient reserves, unprepared financial system— but he presented them as secondary.
“That’s an interesting point but it’s a second-order problem,” he said. The main one, he insisted, is that society does not ask for dollarization.
In addition to talking about dollarization, in the interview Milei made it clear that his government will continue focused on defeating inflation. «The chainsaw is still on. The Central Bank has to continue tightening monetary policy until inflation is defeated. We are not going to give in. “We are not going to give an inch,” he assured.
The president rejected the idea of tolerating more inflation in exchange for greater activity. «The only way under rational expectations that you can affect the level of economic activity is by deceiving the agents. “You are asking me to lie and steal from you because inflation is also theft.”
Dollarization, in this framework, will continue to be an option available to whoever wants to use it. Not a policy that the State imposes.
What if the explanation is Gresham’s Law?
However, There could be a classic economic explanation that nuances the president’s reading.
The Gresham’s Law —stated in the 16th century and summarized in the aphorism “bad money displaces good”— maintains that when two currencies circulate in parallel, people tend to spend the weaker one and hoard the stronger one.
In other words: that Argentines use pesos for their daily transactions does not necessarily mean that they prefer them, but rather that they get rid of them first and that is why there are pesos circulating in the internal economy. It is something similar to what happens with those who have bitcoin (BTC) and prefer to save it instead of spending it.
Under this logic, the question that Milei’s statement leaves open is another: as long as the Central Bank continues to issue pesos there will be a mass of domestic currency that people will look to spend before it loses value.
From such a perspective, The peso circulates not because it is chosen but because it is what “burns.” Dollars, on the other hand, are saved. That people do not dollarize their transactions could be, precisely, confirmation that they value the dollar too much to spend it.