A new regulation from the Argentine central bank forbids payment processors from permitting cryptocurrency transactions on their systems. The bank asserts that this action will lessen the country’s payment system’s exposure to digital assets, which are not subject to national regulation. Both payment fintechs and financial organizations that provide payment accounts must abide by the rule.
The local cryptocurrency market, which has been expanding quickly in the midst of Argentina’s economic crisis and hyperinflation, could be significantly impacted by this choice. With a rise of more than 100% since the start of the year, the price of Bitcoin in Argentine pesos hit an all-time high in April.
Some regions in Argentina have already adopted cryptocurrencies as a way to hedge against inflation and currency devaluation. For example, the province of San Luis launched its own stablecoin pegged to the US dollar in December, which is available to all residents and backed by liquid financial assets. Additionally, some 30% of consumers in the country are said to use stablecoins for day-to-day transactions.
