The Argentine central bank prohibits crypto trading

The Argentine central bank prohibits crypto trading

The Argentine central bank has decided to ban unregulated crypto transactions in traditional banks. Once considered a crypto -friendly country, the pendulum in Argentina is curved after the International Monetary Fund (IMF) reported that political decision -makers had put under pressure. This announcement takes place only a few days after Argentina's largest private bank, which Banco Galicia has decided to add to crypto trade.

"Financial institutions cannot handle or facilitate transactions with their customers in the trade in digital assets, including crypto assets and those whose income is determined by the fluctuation of value by crypto", said the central bank of the Republic of Argentina in A explanation published Thursday. This represents an actual ban, since there are currently no regulated digital assets in the country.

The regulatory authority said that its measures were aimed at "reducing the risks associated with crypto for both investors and for the entire financial system". The Argentine central bank believes that the banks should concentrate their efforts to finance the real economy instead of digital assets. In addition, this implies that these transactions would affect non -regulated companies based outside of Argentina that could "violate" applicable laws.

The campaign follows a warning in May 2021, in which the authorities emphasized the risks of crypto-assets and have taken investors in their investment decisions. These risks include "high volatility, cyber attacks, money laundering and terrorist financing" as well as violations of transnational foreign exchange transactions, according to the central bank.

In 2017, Argentina received a rescue package of $ 44 billion from the IMF-the largest aid package ever. The institution had recently approved a debt rescheduling agreement, and both parties agreed that Argentina "will prevent cryptocurrencies to prevent money laundering, informality and interintermediation," said a declaration of intent that was sent by politicians in March. The declared goal was to "further secure financial stability".

The country has been fighting with high inflation and the devaluation of its currency for years. Argentina's monthly inflation rate rose to 6.7 % in March alone and thus exceeded the forecasts. according to the latest data in the country . The annualized inflation rate reached 55.1 % this month and achieved the highest level in two decades due to increased food and energy prices.

Locals, on the other hand, have started to invest in crypto to protect their savings from shrinking purchasing power, and employers may pay up to 20 % of the salary of an employee in cryptocurrencies. However, the most recent decision of the central bank could reverse the trend towards the mainstream crypto adoption in the country.

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The contribution "Argentina's central bank prohibits crypto trade" is not a financial advice.