It is illegal in Argentina to exchange money outside of the formal market yet we do have a thread about dollar blue and cuevas in this forum

Paying in foreign currency is not illegal at all and many stores throughout the country have signs stating the exchange rate they use, which must be close to the one offered by Banco Nación. Even the real estate market operates in dollars in this country.

The problem with tipping in anything other than pesos is that the person may not find it useful. Most bureaux de change or banks will not change 5 or 10 dollars, or if they do it will be at a very low rate.