Bolivia Unbans Crypto After 14 Years
28 Jun, 2024 ● Crypto News
Bolivia’s central bank, Banco Central de Bolivia, has lifted its ban on Bitcoin and cryptocurrency payments, allowing financial entities to engage in transactions with digital assets to modernize its payment system.
The central bank stated that this decision aims to improve Bolivia’s struggling economy and align it with Latin American crypto regulations.
This regulatory change ends a ban on crypto use in the country that began in 2014.
In December 2020, the government prohibited banking entities from dealing with cryptocurrencies under Board Resolution N°144/2020.
The newly approved regulations permit banks to conduct transactions in cryptocurrencies via approved electronic channels.
However, the central bank clarified that cryptocurrencies are not accepted as legal tender.
Therefore, while banks can trade crypto assets, the Bolivian government does not recognize them as legal tender, and businesses are not obligated to accept them as payment.
Under its Economic and Financial Education Plan, Banco Central de Bolivia also intends to launch an awareness program for the general public.
This initiative aims to educate the public about the potential risks associated with cryptocurrencies and how to manage them responsibly.
The new regulations were developed in collaboration with the Financial Investigations Unit, the Financial System Supervisory Authority, and the central bank.
These three government bodies crafted the regulatory update, which took effect on June 26.
The new legislation also aligns Bolivia’s crypto regulation with the recommendations of the Latin American Financial Action Task Force, making Bolivia another Latin American nation to adopt crypto to help boost its economy.
In recent years, several Latin American countries have been grappling with economic difficulties and rising inflation, prompting them to explore alternative economic solutions.
Bitcoin and cryptocurrencies have become popular as part of a new economic model.
El Salvador was the first Latin American country and the only country globally to adopt Bitcoin as legal tender alongside the United States dollar in 2021.
Mexico does not recognize cryptocurrency as legal tender but allows it for value transfers and payments.
Additionally, Mexico taxes profits from cryptocurrency sales on centralized exchanges.
Brazil has also embraced crypto, introducing income-tax regulations in 2023 that impose a 15% tax on crypto profits.
Argentina has recently elected a pro-Bitcoin president to combat rampant inflation, following the example set by El Salvador.
Sources:
https://cointelegraph.com/news/bolivia-legalizes-bitcoin-crypto-transactions
