Argentina’s central bank has issued new restrictions affecting citizens and businesses that have purchased crypto currency to use as a hedge against currency devaluation. The bank will only sell dollars at the official rate to individuals and businesses that have not purchased crypto for at least 90 days prior to the operation, with the goal of curbing exchange rate appreciation.
Argentine crypto users were excluded from purchasing dollars on the official market
The Argentine government is trying to stop the escalation that the blue dollar exchange rate, the price of the U.S. dollar on the country’s unofficial market, has had for several weeks. Argentina’s central bank has issued a resolution that excludes companies and individuals who purchase cryptocurrency from accessing the dollar at the official rate.
Thecommunication, identified by the number 7552,declares that access to the official dollar market will be open to the following individuals and companies.
funds in local currency or other local assets (other than funds in foreign currency deposited with local financial institutions), whether resident or nonresident, related or not, directly or indirectly, through themselves or through related, controlled or controlled entities, for prior or subsequent consideration Delivered to any person or entity receiving foreign assets, crypto assets or offshore depository receipts.
These restrictions must be met 90 days prior to the purchase of dollars on the official market.
Closing Loopholes and Local Reaction
According to local sources, the new set of restrictions will allow some organizations to take advantage of exchange control channels for their own benefit, buying cheap dollars at official rates and using these to purchase cryptocurrencies and then use these to buy cryptocurrencies and exchange them at higher rates. The Argentine Central Bank also introduced new restrictions prohibiting purchasers of these dollars from buying any cryptocurrency in the 90 days following the operation, in order to avoid the situation described.
The reaction of Argentines was mostly negative, with some questioning the effectiveness of such a measure. Economist Agustin Monteverde criticized the logic behind the measure. He stated that,:
this measure is arbitrary and discretionary. I don’t understand why someone who buys a certain commodity (because it is a crypto) would not have access to the exchange market.
The measure began to be applied last July 22, and Argentines are already trying to move from traditional exchanges, which require notification about crypto transactions, to peer-to-peer based exchanges where transactions can be kept private between two parties.
What do you think of the new restrictions imposed on crypto investors by the Argentine government? Let us know in the comments section below.
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