The Central Bank of Argentina will prohibit local institutions from providing crypto services
Argentine banks are unable to provide digital asset services since no regulations have been developed for the country’s crypto industry, according to the BCRA.
Argentina’s Central Bank (BCRA) has banned domestic financial institutions from assisting crypto-related transactions. Brubank and Banco Galicia have just announced that they would enable customers to buy digital assets using their official websites.
Earlier this week, the biggest private bank in Argentina in terms of market value – Banco Galicia – and the digital bank – Brubank – collaborated with crypto wallet Lirium to offer cryptocurrency services to consumers. Both sides underlined the enormous demand people have exhibited for digital goods as reasons, particularly from the younger generations.
In spite of this, Argentina’s central bank has indicated that domestic monetary institutions are prohibited from providing such possibilities since the BCRA has yet to set laws on the sector..
By implementing this action, the BCRA Board of Directors hopes that the risks that might be produced for customers of financial services and the whole financial system would be reduced. “
The BCRA, like many other central banks, addressed some of the most talked-about hazards associated with digital assets in its latest report. Using bitcoin and other altcoins for money laundering or terrorist funding is possible because of their volatility, according to the organisation.
While the value of most crypto assets fluctuates greatly, others say that they are not readily used in criminal activities. For starters, the blockchain of Bitcoin is completely transparent, since all transactions are recorded and made available to everyone who is a part of it.
Cash, on the other hand, is still commonly utilised in drug trades, armament funding, prostitution, and other illegal activities.
It’s a Great Place for Cryptocurrency in Argentina
However, despite the attitude taken by the central bank, the digital asset market is flourishing in Argentina. With an unsteady economy in recent years, the COVID-19 epidemic further impacted the nation. Rather than hold on to their depreciating fiat currencies, most residents of the country decided to invest in the rising crypto market by the year 2020.
According to Binance’s Latin American team, new users in Argentina would treble in the next year. Argentina’s huge land, low-cost power, and pleasant weather all contributed to the growth of the country’s bitcoin mining industry.
As a result of these developments, a number of bitcoin exchanges have formed alliances with organisations in the U.S. sports industry. Bybit teamed with the Argentine Football Association (AFA) in November to become the team’s Global Main Sponsor. Binance followed suit soon after.