July 14, 2024
Bitcoin News

Bolivia Embraces Crypto: Central Bank Lifts Ban on Bitcoin

In a significant move to modernize its financial system, Bolivia’s central bank, Banco Central de Bolivia, has lifted its ban on Bitcoin and cryptocurrency payments. This decision marks a major shift in the country’s regulatory stance on digital assets.

Economic Boost and Regulatory Alignment

The central bank’s decision is aimed at bolstering Bolivia’s struggling economy and aligning its crypto regulations with those of other Latin American countries. The new regulations, effective June 26, end a crypto ban that started in 2014 and prohibited banking entities from dealing with cryptocurrencies since December 2020 under Board Resolution N°144/2020.

Bolivian central bank’s announcement on crypto transactions. Source: Banco Central de Bolivia

Banks are now allowed to transact in cryptocurrencies through approved electronic channels, though these assets are not recognized as legal tender. Businesses in Bolivia are not required to accept cryptocurrencies as payment, but they can facilitate transactions involving them.

Public Awareness and Education

Banco Central de Bolivia has also announced plans to launch an awareness program as part of its Economic and Financial Education Plan. This initiative aims to educate the public about the potential risks associated with cryptocurrencies and how to manage them responsibly. The program highlights the importance of understanding digital assets before engaging in crypto transactions.

The regulatory update was a collaborative effort involving the Financial Investigations Unit, the Financial System Supervisory Authority, and the central bank. The new legislation aligns with recommendations from the Latin American Financial Action Task Force. It positions Bolivia among other Latin American nations embracing cryptocurrencies like Bitcoin to boost their economies.

Regional Crypto Adoption

Bolivia’s move follows a growing trend in Latin America, where countries are increasingly turning to cryptocurrencies as alternative economic solutions amid economic struggles and rising inflation. El Salvador set a precedent by adopting Bitcoin as a legal tender alongside the US dollar in 2021.

Mexico, while not recognizing cryptocurrency as legal tender, allows its use for value transfers and payments. It also taxes profits from crypto sales on centralized exchanges. Furthermore, Brazil, seeing a rise in crypto adoption, introduced a 15% tax on crypto profits in 2023. Argentina has also elected a pro-Bitcoin president to combat inflation, taking cues from El Salvador’s crypto policies.

With these changes, Bolivia joins the ranks of nations leveraging digital assets to drive economic innovation and stability.

Image by www.slon.pics on Freepik

Disclosure Statement: Miami Crypto does not take any external funding, or support to bring crypto news to the readers. We do not have any conflicts of interest while writing news stories on Miami Crypto.

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