On May 4, Argentina's central bank banned payment providers from offering crypto transactions, claiming that it intends to reduce the country's payment system's exposure to digital assets.
Payment providers are not allowed to offer or facilitate crypto services through their apps, according to the monetary authority's statement. The move puts payment fintech companies and financial institutions under the same rules in the country.
“Payment service providers that offer payment accounts are not allowed to conduct or facilitate operations in digital assets, including encrypted assets, that are not regulated by the competent national authorities and not authorized by the Central Bank of the Argentine Republic,” said the authority. Cryptocurrencies are not regulated in Argentina, which means that all coins and tokens are subject to the decision.
It is unclear how the measure will affect the local crypto industry. The payment provider declined to comment on the decision, local media reported. The Argentine Fintech Chamber urged the government to reconsider the decision, claiming that "it limits access to technologies that provide multiple benefits and opportunities for our society." Hyperinflation is driving cryptocurrency adoption in Argentina. Bitcoin price in April. The Argentine Peso (ARS) hit a new all-time high as BTC traded at more than 6.59 million Argentine Pesos up more than 10 0% so far this year.
Inflation in the country surged 104.3% year-on-year in March, following a rise of 102.5% the previous month, according to the Office for National Statistics. Bitcoin's popularity in the country also coincides with the continued depreciation of the Argentine peso, Cointe legraph reported. The currency has fallen nearly 50% against the dollar over the past year.
