Chile Crypto Exchanges Slam on Banks for Service Denial

Adoption Banking Legal Regulation

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Sead Fadilpašić

Journalist

Sead Fadilpašić

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Sead specializes in writing factual and informative articles to help the public navigate the ever-changing world of crypto. He has extensive experience in the blockchain industry, where he has served...

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June 26, 2023 06:53 EDT

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Two crypto exchanges from Chile have made a joint public statement calling out the country’s baking association (Asociación de Bancos e Instituciones Financieras or ABIF) for not having a clear stance on the industry.

The companies, BUDA and Crypto MKT have condemned the closing of their local banking accounts and said that a bank representative told them that they had instructions to “not open an account for anyone that has relation to cryptocurrencies.”

In the public statement, they warn that, “The lack of knowledge and regulatory clarity has given rise to the fact that some banks, out of fear, misinformation or perhaps by strategy, are refusing to provide their services to anyone who has any relationship with any digital asset,” adding that “in Chile the regulation is in the hands of a few, who are acting as de facto regulators and are opting to prohibit.”

They have called on ABIF to make their position transparent, which means to come clear with their stance on whether companies dealing in crypto will be able to gain access to banking services – or if the banks “are determined to prevent the existence” of the industry.

The two companies also underline that they present no legal risk to banks, stating that they, “have developed safe platforms of the latest technology for the protection of their customers and have opened channels of collaboration with authorities,” as well as explaining the ins and outs of trading to the public. Both firms also pay taxes, are registered with the relevant authorities, and follow standard prevention of money laundering, says the statement.

Chile is not the only country where cryptocurrency related businesses have to fight with traditional banks. With cryptocurrencies ironing out issues and gaining credibility, several banks have opted to take a hard line on them, thereby frustrating the domestic efforts of virtual currencies to gain traction in the financial industry and greater world, as reported. With renewed regulatory focus all over the world as lawmakers seek to both educate themselves on cryptocurrencies while enacting regulatory legislation, court battles are becoming the norm.