Wednesday, October 5, 2022

Argentina’s Apex Bank Halts All Crypto Trading Activities

The central bank of Argentina otherwise known as Banco Central de la República Argentina (BCRA) has issued a notice, stopping financial institutions in the country from offering digital assets services and investment opportunities to its citizens.

According to the announcement, BCRA recalls that the duties of commercial banks to its citizens should strictly be focused on “financing investment, production, marketing, consumption of goods and services required by both domestic demand and export.”

On Monday, two private banks in Argentina announced the integration of cryptocurrency trading to their services, Banco Galicia followed by Brubank.

The former had delved into investment in Bitcoin (BTC) owing to polls derived from a survey carried out in order to ascertain the stance of the citizens of Argentina on the adoption of cryptocurrencies. The polls revealed that 60% of South American nationals voted for the use of crypto. 

This looked like good business for Banco Galicia, hence the move to integrate crypto investments into its banking services, a move that was closely followed by Brubank. There have, however, been concerns about the stance of the Argentinian government on the recent move of the megabanks. A concern that has now birthed the stringent announcement.

The BCRA frowns at the offering of cryptocurrency assets to its public, adding that the government has not yet established structures and facilities to regulate virtual assets. Hence, no financial institutions under its watch should incorporate crypto investment services.

Further in the notice, the central bank strictly warned that entities involved in the operation of cryptocurrency trades are not authorized in the country, adding that non-compliance to this warning will result in outright disobedience to the laws of the nation.

In May last year, BCRA published a notice in collaboration with the National Securities Commission (CNV) informing its public of the risks involved in trading with cryptocurrencies. Which is largely linked to the vulnerability of the blockchain market to various illicit crimes that pose insurmountable threats to its citizens and nation at large.

In March this year, the government of Argentina revealed a memorandum derived in collaboration with the IMF. The document unveils that the former will be discouraging the use of cryptocurrency within its border in conformation to the demands of the agreement.

As of the time of writing this report, no responses have been gotten from the megabanks regarding the new development. However, there have been several reactions on social media.

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Israel Love
Israel Love is a passionate writer that enjoys educating and inspiring people through his writing. This passion fuels the desire to simplify the complexities in the blockchain ecosystem, by providing viable information about the crypto space in such a way that makes it easy for anyone to understand. Israel love also has interests in Human Resource Management as he is a trained expert in HR.

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