Argentina National First: Regulator Approves Registration of Company With BTC, USDC Capital

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Tim Alper

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Tim Alper

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Tim Alper is a British journalist and features writer who has worked at Cryptonews.com since 2018. He has written for media outlets such as the BBC, the Guardian, and Chosun Ilbo. He has also worked...

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July 24, 2024 23:00 EDT

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In an Argentina national first, a law firm says a regulator let it register a firm whose capital is partially made up of Bitcoin (BTC) and USD Coin (USDC).

Per the media outlet Infobae, one of the firm’s partners put up USDC 195 and BTC 0.00457621 (just over $303) as “initial capital.”

The deal was ultimately green-lighted by the General Inspection of Justice (IGJ), the body that oversees company registration in Argentina.

Argentina National First for BTC, USDC-holding Firm

While the sum is relatively low, it nonetheless represents a legal breakthrough for law firms and crypto holders in Argentina.

Pablo Palazzi, a partner at the law firm Allende and Brea explained how the deal was finalized.

Palazzi said that when firms use non-cash assets such as land or real estate as capital, they need to use accounting studies to prove the value of these assets.

Lawyers then help transfer these assets’ ownership to the new company. However, Palazzi noted, that since the firm used crypto instead, “the procedure was different.”

The lawyer explained that the company created new crypto wallets for the company and the firm’s token-holding partner on the Lemon Cash and Ripio crypto exchanges. The law firm used these wallets to conduct a capital transfer. Palazzi said:

“The valuation of crypto assets happens in real-time. The crypto market, unlike the stock exchange, never closes. So both platforms helped provide a kind of ‘valuation certificates’ for the cryptoassets at the time of the transfers.”

The lawyer pointed out that this was a key step. Argentina’s General Law of Companies (LGS) requires all assets’ values to be calculated precisely in capital-related transactions.

Complicated Process: Using Crypto as Capital

Allende and Brea also had to enlist the help of an accountant and a notary to “certify the value of the cryptocurrencies at the time of the transfer,” and “verify the existence of the wallet and the transfers.”

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— Bloomberg (@business) July 23, 2024

Palazzi praised the IGJ for staying “up to date with current technological developments.” The lawyer said the body’s “innovative regulations” made it a “pioneer” in “Latin America and the rest of the world.”

Lemon’s Legal Manager Delfina Hermansson said the IGJ’s approval “represents a significant update of Argentinian corporate law.”

Earlier this month, a report claimed that Argentine citizens are increasingly turning to stablecoins like USDC and USDT.

Many citizens, industry insiders claim, are now “hoarding” USD-pegged coins instead of trading them for BTC.