Javier Milei’s Argentina has achieved a unique precedent for itself. The South American nation, as reported by Argentine media Ámbito, has become the first across the world to put lithium on the blockchain, thus tokenising it. It’s looking towards the first three months of the approaching new year (2025) to set its ambitious plans into motion.
Cardano is the blockchain where the tokenised mineral will be traded. Apart from Cardano, the other entities involved in this new venture are Atómico 3, zenGate and lithium exploring company, Alto Grande SA.
In fact, there are several companies – Argentine entities either by themselves or in partnership with Australian, French and Chinese conglomerates – engaged in the lithium extraction processes there.
Through this step, the Latin American country aims to leverage the humongous lithium resources it has at its disposal. Likewise, in doing so, it’s looking at getting the following advantages for itself.
Firstly, the trading of lithium as a token would bring down the heavy costs of operation incurred to mine lithium while the mineral would be traded as a blockchain entity. Also, with these trading transactions being opened to interested traders worldwide, it would also mean a transfer of ownership without the country ceding control of its physical ownership of the commodity.
Due to the existing bona fides of Cardano, it’s also expected that the trading of the lithium token would also be impervious to any kind of shady transactions.
Crypto Lithium Index
Earlier, reports had emerged that Cardano, Atómico 3 and zenGate had gotten together with the objective of creating a “Crypto Lithium Index”. In fact, it was Atómico 3’s creator, Paul Rutigliano, who’d proposed this idea for the three entities to join forces together.
The reason for the conception of the “Crypto Lithium Index” was to ensure that those closely involved in the lithium sector could gain better understanding of the upheavals of price affecting the mineral, right from when it’s drilled and extracted, to when it’s put into eventual use. And, in doing so, withstand them better, if not avoid them entirely.
Argentina’s Natural Gift
The northern provinces of Salta, Catamarca and Jujuy are where Argentina’s natural endowments, in the form of lithium, are available. With lithium’s emerging to be a clear frontrunner as a viable mineral in clean energy, Argentina is seeing a surge in the demand for its lithium resources.
Alto Grande SA is one such company that’s come up looking to make the most of the lithium boom currently happening in Argentina now. The company, a subsidiary of the Argentine giant, Alto Grande, was formed in 2022.
Statista reports Argentina’s lithium reserves to be at 3.6 million metric tons. This translates to 20.5% of the total reserves of the mineral found in the world. Argentina, Bolivia and Chile also form part of what’s called the “Lithium Triangle” in the South American continent. These countries that form the Triangle are the ones that have the most deposits of the mineral in the world – a little over two-thirds, at 65%. While Chile’s deposits and the size of its extraction industry far supersede Argentina’s, the latter country’s new government is prepared to go all out in its quest to turnaround the stagnant state of its economy by putting its prized mineral on the map, literally and figuratively.
Argentina’s RIGI
Through its new economic endeavour, Régimen de Incentivos para Grandes Inversiones (RIGI), Argentina is seeking to attract massive foreign investment to tap into the abundant and myriad natural resources it has. One of the focus sectors of RIGI is mining, with lithium featuring prominently among them.
By taking the first step towards tokenising lithium, Argentina has ushered a new paradigm. It’s one of which the other countries should – and will – take note. Truly, after this call, there’s no place on earth where cryptocurrency will not have a presence. Not even a mineral lying miles and miles under its surface is an exception to its ever-growing grip.
Interesting and quite insightful