Argentina tightens controls on crypto transactions

Argentine digital-asset companies could face difficulties if the new central bank guidelines are approved.

The document was developed afterIMF recommendations to limit the use of cryptocurrencies in the country.

Guidelines ban certain activities. Specifically, registered payment service providers will not be able to carry out, themselves or through partners, operations with digital assets that are not regulated and not authorised by the central bank.

The central bank said the rules were designed to reduce risks … for users of financial services and the national payment system.

In a commentary for The Block, the non-profit Bitcoin Argentina called the guidelines ‘arbitrary’.

“It is unclear what the central bank is trying to achieve by banning activities that fully satisfy and are beneficial to customers of local exchanges. As a result, … it will be difficult to access alternative saving options that protect them from inflation,” commented its representative Marcos Sokaro.

Bitcoin Argentina suggested that alternative solutions with greater risks and costs may emerge for consumers.

According to Sokaro, the rules are non-specific. There are various interpretations of the extent to which payment service providers will be able to work with crypto exchanges, he noted.

For an industry analyst, MercadoPago, the biggest player in the space, will not be able to offer as wide a range of services as in neighboring Brazil.

Representatives from Binance said their services would continue operating as before.

In a similar vein, Bitso staff noted that the firm is not registered as a payment service provider in Argentina and is regulated by European authorities.

“The team is working on understanding the scope and implementation of the rules”, the specialists explained.

In April 2023, Binance announced expansion of services in Argentina.