Argentina has finalized regulations for virtual asset service providers (VASPs) to ensure transparency and user protection in the cryptocurrency market. The rules, effective from March 2024, cover cybersecurity, asset custody, and compliance requirements, including registration and separation of funds. Compliance deadlines are set for local and foreign entities, amid a backdrop of rising crypto adoption driven by the depreciation of the Argentine peso and stablecoin utilization.
Argentina has recently established regulations for virtual asset service providers (VASPs), aimed at enhancing transparency and user protection within the cryptocurrency market. Published on March 13 by the National Securities Commission (CNV) under General Resolution No. 1058, these guidelines outline general codes of conduct and custody requirements that all cryptocurrency exchanges and digital asset platforms must adhere to. The regulations require VASPs to implement measures concerning cybersecurity, asset custody, money laundering prevention, and risk disclosure.
The regulations mandate the separation of company and client funds, necessitate annual audits, and require monthly reporting to the CNV, as noted by Argentine tax lawyer Diego Fraga. Starting from 2024, VASPs must register with the registry of virtual asset service providers (PSAV). Noncompliance can lead to registration revocation, with entities operating without such registration potentially facing court orders to cease operations.
Registered individuals must comply with new regulations by July 1, 2024. Companies established in Argentina are given until August 1 and foreign companies until September 1 to meet the new requirements. Roberto E. Silva, the president of CNV, stated that failure to comply will result in the inability to operate within Argentina.
The regulatory initiative arose amidst increased cryptocurrency adoption in Argentina, particularly following economic hardships such as the depreciation of the Argentine peso. A report from Chainalysis highlighted that by mid-2024, the nation had become the leading Latin American country for crypto inflows, surpassing Brazil with around $91 billion from July 2023 to June 2024. Despite facing setbacks such as the LIBRA scandal involving President Javier Milei, local interest in cryptocurrencies remains robust, particularly in stablecoins like Tether’s USDt (USDT).
In summary, Argentina’s newly implemented regulations for virtual asset service providers aim to enhance financial stability and protect users within the burgeoning cryptocurrency market. With strict compliance deadlines and requirements for registration, the CNV is taking significant steps to regulate the growth of digital asset transactions. Despite challenges such as recent scandals, the trend towards increased cryptocurrency adoption in Argentina appears resilient, underscoring the nation’s evolving financial landscape.
Original Source: cointelegraph.com
