Just-In: Argentina Prohibits Banks From Offering Crypto Services

In a big blow to the Cryptocurrency industry, Argentina has prohibited all digital asset related services provided by the banks. According to the report, the Central Bank of Argentina (BCRA) has mentioned that digital currencies having blockchain registration are also unauthorized for use.

BCRA cracks down on Crypto

This move has come after two Argentinian banks began supporting the trading of crypto. Banco Galicia bank came ahead to offer 4 different crypto tokens to its customers. The list included Bitcoin (BTC, Ethereum (ETH), USD Coin (USDC) and Ripple’s XRP.

The Board of Directors of the BCRA has taken strict steps in order to minimize the risk involved in dealing with digital assets. The board cited volatility, cyber hack, and money laundering in the market. The statement also mentioned digital assets whose yield depends on fluctuations in the cryptocurrency market.

Banks from Friday would not be offering their customers to trade any digital assets. Meanwhile, the BCRA has advised the banking institutions to focus on investment, production and consumption of goods and services. This Year, the International Monetary Fund (IMF) and Argentina jointly approved a $45 billion debt package that covers the provision like casting down the use of digital currencies.

Argentinians using Crypto to evade inflation

Back in May 2021, the Argentinian Central Bank and the National Securities Commission (CNV) pushed jointly issued an alert. The notification called for information regarding the implications and risks related to digital assets. It also asked to maintain a sensible outlook to reduce the vulnerability of investors.

Argentina stands on the list of top 10 countries adopting cryptocurrencies. However, the recent inflation and currency crises have taken over their economy. The inflation is running over 50% damaging the value of the country’s savings. The Argentinian population has been using the cryptocurrency market to evade the valve to the increased Inflation. Meanwhile, the Crypto exchanges like Binance, Coinbase and PancakeSwap have not been granted official licenses to operate in the country.