Connect with us

À la une

Why should banks adapt to bitcoin and cryptocurrency? Lawyer answers

Published

on

Key facts:
  • For Carolina Vesa, it makes no sense for AML regulations to exclude stock exchanges.

  • International organizations suggest that banks manage risks, but not avoid them completely.

Chilean lawyer Carolina Vesa said banks must modernize and adapt to new technologies, as well as regulations. As part of the Santiago Polytechnic Conference, the legal specialist referred to the role of banks and bitcoin (BTC) and cryptocurrency exchanges in preventing money laundering.

This issue, money laundering, has sparked significant business disputes and debates in the Chilean cryptocurrency ecosystem. Between 2014 and 2018, exchanges such as Buda.com, Crypto Market, and Orionx suffered the closure of all their bank accounts..

Specialist Carolina Vesa, who works for the law firm CMS Carey y Allende Chile, spoke about this issue and its consequences in her exhibit at the Polytechnic University of Santiago. It was an event that brought together the Ethereum community in the Chilean capital last Friday, September 23.

The exchanges are potential competitors of banks in the international investment, credit and remittance market, he explained. In this context, 10 banks in that country made the decision “independently, but en bloc.”he said.

These entities provide 99% of current accounts to legal entities in Chile.so their relevance in the economic and financial sector is obvious. Of course, they were also essential to the stock exchanges, which are now authorized to operate bank accounts.

The reason for banks to close exchange accounts is that exchanges, by connecting to cryptocurrency users, could link them to people trying to launder money.

A lire aussi :   Bitcoin dans le nouvel ordre monétaire | L'analyse du Credit Suisse sur la crise actuelle

Regulation should not exclude trade

However, according to attorney Vesa, banks have omitted the fact that the exchanges’ know-your-customer (KYC) policies are a weapon in their favor in the fight against this crime.

“Why does a regulation that seeks to prevent money laundering exclude exchanges and prefer cryptocurrencies to be traded in P2P (peer-to-peer) transactions?” he asked. “It doesn’t make sense,” he added.

Those who interpreted this circumstance were the Financial Action Task Force (FATF).which recommended that banks should not carry out derisking (total elimination of risks, such as the measure of closing current accounts), but “managing” them.

It is that if banks nip the relationship with the exchanges in the bud, the FATF would lose access to a lot of valuable information. about the transactions that take place on these platforms. As reported by CryptoNews, the international organization is putting increasing pressure on stock exchanges to apply the travel rule in their operations.

Banks must cooperate with cryptocurrency companies.

Carolina Vesa thus comes to the conclusion that banks should should not oppose these new technologies which are bitcoin (BTC) and other cryptocurrencies, but to “modernize and adapt.” Cryptocurrencies and blockchainCompanies will have to do this sooner or later because “they will also have to deal with other disruptive technologies in the future.”

“There are banks that are willing to open up and have relationships with the cryptoasset industry, although they are very few,” the specialist clarified. “Technological change is coming and it is a reality. Some banks have realized it,” he added.

A lire aussi :   Bitcoin: -6% par semaine, comment investir dans la reprise

For his part, banks demand a level playing fieldhe explained. Just as these entities are obligated to report suspicious transactions of their clients to tax authorities, they want exchanges to have the same obligation. “This is essential to the discussion,” Carolina Vesa said.

Continue Reading

Trending

Copyright © 2017 Zox News Theme. Theme by MVP Themes, powered by WordPress.