Argentinian Senate Passes USD 45B IMF Debt Deal That Discourages Crypto Use

 

The Argentinian Senate, the upper chamber of the country’s parliament, has voted to approve a USD 45bn debt deal with the International Monetary Fund (IMF) in a move designed to prevent Argentina’s default.

The country’s government hopes the package will allow Argentina to leave behind a lengthy financial crisis, reported local daily La Nación. The vote converts the agreement into law, but it also introduces a controversial provision that discourages the use of cryptoassets by the country’s population.

In a bid to further safeguard Argentina’s financial stability, the country’s authorities said they vow to take important steps to discourage the use of cryptoassets “with a view to preventing money laundering, informality and disintermediation,” among others.

This said, the letter does not specify any precise methods Buenos Aires could use to hamper the population’s embrace of crypto. 

At the same time, Argentina’s government is also declaring it will further support the process of digitization of payments with the aim to improve the efficiency and costs of payments systems and cash management. This, however, does not include promoting the use of crypto, as suggested by the earlier statement.

The crypto provision is part of a Technical Memorandum of Understanding (TMU) that Buenos Aires signed with the international organization on March 3, and that accompanies the letter signed by Miguel Pesce, President of the Central Bank of the Argentine Republic, and Martin Guzman, the country’s Minister of Economy.

“Our plan is carefully calibrated to Argentina’s specific circumstances, notably the challenging economic and social situation which were exacerbated by the global pandemic,” the two officials said. 

“While commercial banks remain liquid and well-capitalized, strong bank oversight will continue, especially following the unwinding of pandemic-related regulatory forbearance,” they added. 

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