Argentina’s central bank is tightening its grip Crypto transactions in the inflation-ridden countryafter issued last week new guide prohibiting some companies from certain activities.
In particular, registered payment service providers known locally as PSPCPs may not conduct or facilitate any operation on any digital asset that is not regulated and authorized by the Central Bank. The May 4 notification states that the providers cannot carry out the transactions themselves or initiate them on their apps or web platforms.
companies formally registered Central bank payment service providers include big players like MercadoLibre, Bind Pago, Mobbex, Nubi and Pomelo. The rules appear to target “automatic purchase buttons” and interested users wishing to make such transactions “should do so of their own accord”.
The central bank said the new measure aims to “mitigate the risks that transactions in these assets could pose to users of financial services and the national payment system”.
Crypto usage in the country has increased, especially as Argentines rush to protect their savings in the face of annual inflation exceeding 100%, multiple exchange rates, and capital controls. Still, widespread adoption has encountered obstacles, particularly due to fears of volatility and widespread skepticism about potential scams.
Bitcoin Argentina NGO says the rules are surprising and arbitrary
Bitcoin Argentina, an NGO working to promote the use of cryptocurrency and decentralized technology in the country, called the move surprising and arbitrary.
“It is not clear what the aim of the central bank is in banning an activity that is entirely satisfactory and useful to customers of local exchanges,” read an emailed statement. “This will have the immediate effect of making it difficult for Argentine workers and savers to access savings alternatives that protect them from inflation.”