Argentina's Central Bank is considering repealing the current regulation that completely bans banks in the country from offering cryptocurrency services.
Argentina's Central Bank Prepares to Lift Crypto Ban: Banks May Gain Trading and Storage Authority
If the new framework is adopted, banks will be able to offer both crypto trading and digital asset custody services. This move represents a fundamental shift in current policy, as Argentina has long implemented a ban that has kept crypto activities out of the banking sector.
The new regulation aims to transition from a ban to a model based on oversight and supervision. The Central Bank's goal is to legalize the rapidly growing use of Bitcoin and stablecoins in the country, while also strengthening know-your-customer (KYC) and anti-money laundering (AML) standards. This aims to both protect users and enhance the transparency of the financial system.
If the regulation goes into effect, it would allow banks to compete directly with crypto platforms. This could mean lower transaction fees, more secure storage solutions, and a wider range of services for users.
However, banks will need to meet additional capital requirements, liquidity requirements, and risk management standards to offer crypto services, which could create a new operational and financial compliance burden on banks.
Argentina's move comes at a time when cryptocurrency use is rapidly increasing in the country. If approved, the regulation would further institutionalize and regulate the role of cryptocurrencies in the country's financial system.
*This is not investment advice.
