Argentina to Implement Crypto Regulations in 2024
Cryptocurrency usage in Argentina has experienced a dramatic surge, with over 1.3 million people currently using crypto in the country. This accounts for 2.94% of the population, highlighting the significant adoption rate. The rising popularity of cryptocurrencies in Argentina can be attributed to the country’s strict controls over foreign currencies, which aim to protect against inflation and prohibit the transfer of foreign currency outside its borders.
It is important to note that while cryptocurrency is not considered legal tender in Argentina, it is not prohibited either. The government does not issue or guarantee cryptocurrencies, as they are not issued by a government monetary authority. Only the Central Bank of Argentina has the authority to issue legal currency in the country.
According to a survey by Americas Market Intelligence, Argentinians have shown great interest in virtual currencies. More than one out of ten Argentinians currently have some form of cryptocurrency investment, and an additional 18% express interest in buying crypto in the future.
In April 2022, the International Monetary Fund (IMF) approved a new $45 million refinancing agreement with Argentina, providing the country with much-needed relief from debt payments until 2026. This move by the IMF has further supported the growth of cryptocurrency adoption in Argentina.
In terms of regulations, the National Securities Commission (CNV) in Argentina has taken steps to facilitate the arrival of new fintech and crypto-based investment instruments to the market. The CNV has also issued warnings about the risks associated with initial coin offerings (ICOs) and the use of crypto assets in collaboration with the Argentina Central Bank.
When it comes to taxation, the income derived from the holdings or disposal of virtual currency is considered to be from an Argentina source if the issuer is resident, established, or located in Argentina. The tax rates for gains obtained from the disposal of digital currency range from 15% for resident individuals to 25-30% for resident legal entities.
Crypto mining is permitted in Argentina, and there are currently no specific rules or regulations governing this activity. One town in Argentina, Serodino, has started mining cryptocurrencies to generate income for upgrading its rail infrastructure. The minted cryptocurrencies are then converted into Argentina’s fiat currency to fund the renovations.
In conclusion, Argentina’s economic downturn, coupled with high inflation and a deflating currency, has contributed to the increased interest in cryptocurrencies. Many Argentinians are turning to Bitcoin, Tether, Ethereum, and Dai as alternative investment options. With the government taking steps to regulate and facilitate the growth of the crypto industry, it is expected that cryptocurrency adoption will continue to rise in Argentina.