The Central Bank of Argentina warned financial institutions against dealing with digital assets due to their volatility and high level of risk.
According to statement Central Bank of Argentina (BCRA), digital assets are not regulated by the state authorities of the country, therefore, banks and financial institutions cannot conduct transactions with them and assist clients in carrying out these transactions.
The BCRA Board of Directors believes that the ban on working with digital assets will reduce the risks that may arise both for bank customers and for the financial system as a whole. The regulator recalled that the activities of financial institutions should be aimed at financing investment, production, marketing, and consumption of goods and services in order to stimulate their exports and domestic demand.
If banks serve unregistered entities involved in transactions with crypto assets, this may lead to a violation of established rules. The Central Bank fears that in addition to the high volatility of cryptocurrencies, people may lose money due to possible operational failures and cyber attacks.
In addition, cryptocurrencies can be used for money laundering and terrorist financing, the regulator said. His fears are intensified by the risks of possible non-compliance with the rules of the exchange when making international transactions, the ambiguity of the regulation of the crypto industry and the lack of guarantees for users of financial services.
The central bank’s warning comes days after two of Argentina’s largest banks, Banco Galicia and Brubank, announced that their clients would be able to trade BTC, ETH, XRP and USDC stablecoins. The decision of banks to add support for crypto assets is due to the desire of their customers to get simplified access to the cryptocurrency market.
However, the statement of the Argentine central bank regarding cryptocurrencies was quite expected. BCRA President Miguel Ángel Pesce has previously spoken out against cryptocurrencies, calling them unstable assets.
Source: Bits
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.
