In a bid to reinforce Argentina’s fragile foreign currency reserves without fuelling monetary emissions or distorting the exchange market, President Javier Milei’s administration has unveiled a complex and multi-tiered strategy. At the core lies an aggressive push to monetise state assets, secure favourable debt placements, and channel dormant private dollar holdings—commonly known as “mattress dollars”—back into the formal financial system.

According to El Cronista, Economy Minister Luis Caputo is spearheading a series of asset sales, notably through the Agencia de Administración de Bienes del Estado (AABE), the government body overseeing national property. The AABE has been authorised to auction over 300 state-owned properties across Argentina, including high-value real estate in the City of Buenos Aires, Rosario, Mendoza, and Villa La Angostura. Among the more prominent listings is a 1,818 m² lot opposite Plaza Congreso with a base price of $3.34mn, and a sizeable 9,000 m² plot in Guaymallén starting at $942,883. These auctions could generate “thousands of millions” in revenue for the Treasury, Caputo claimed.

Simultaneously, the government aims to capitalise on expiring energy concessions. Hydroelectric plants in Neuquén and Río Negro, namely Alicurá, El Chocón, Cerros Colorados and Piedra del Águila, are slated for reprivatisation. These facilities, which together contribute significantly to Argentina’s domestic power output, are projected to fetch between $400 and $500mn. The process aligns with a broader privatisation agenda outlined in the recently approved “Ley Bases”, which also earmarks state-owned enterprises such as AySA, Enarsa, Nucleoeléctrica and Trenes Argentinos for potential divestiture.

Alongside asset sales, the Milei government is actively leveraging capital markets to improve its reserve position. Bloomberg Línea reported a recent bond issuance in which the Treasury secured ARS6.367 trillion, achieving a rollover of nearly 162%. A key component of this operation was the reopening of the Bonte 2030 bond, which alone added $500mn to the net international reserves. Notably, the bond caters to domestic investors providing dollar-denominated capital, yet repays in pesos, thereby limiting the central bank’s exposure to currency volatility.

This funding drive also includes a strengthened “repo” facility with international banks, now expanded by an additional $2bn. Part of this surplus will be used by the Treasury to purchase Central Bank-held sovereign debt, effectively recycling state liabilities and fortifying the Central Bank's balance sheet.

Yet, the most controversial leg of the strategy revolves around the so-called “dólares del colchón," the estimated $271bn in undeclared cash held by Argentines outside the banking system. According to DW, Milei’s government has introduced a bill dubbed the Fiscal Presumption of Innocence, aimed at granting tax amnesty to holders of undeclared dollars. This move is designed to erode the barriers that prevent informal savings from entering the formal economy.

The measure builds upon earlier tax amnesty frameworks and seeks to monetise these reserves by fostering trust through deregulation and legal assurances. Milei, who once derided the peso as “worth as much as shit”, now encourages citizens to use their stashed dollars to drive domestic consumption and investment.

However, analysts are sceptical. Eugenio Marí, chief economist at Fundación Libertad y Progreso, told DW that while the legal framework may be appealing, many Argentines still regard their dollar savings as financial lifelines. Trust in institutions remains low, and despite improved macroeconomic indicators—such as disinflation and budget surpluses—concerns persist over rising prices for essentials, exacerbated by the rollback of subsidies.

Nau Bernues, CEO of investment firm Quaestus Asteriscos, believes the government’s ultimate aim is to normalise the use of dollars for everyday transactions, further dollarising the economy by stealth. “The state is doing everything possible to increase the circulation of dollars,” he noted, citing ambitions for the greenback to be used in everything from property to groceries.

Taken together, the Milei administration’s multi-pronged approach represents a calculated attempt to stabilise the economy and bolster reserves without defaulting to the printing press or unsustainable exchange rate interventions. While early signs are promising, particularly in terms of bond market uptake and fiscal discipline, the success of the libertarian leader's flagship plan hinges on a fragile and elusive element: public confidence. Whether Argentines will relinquish their mattress dollars remains uncertain, but the government’s fiscal architecture now depends on it.