Argentina’s CNV Finalizes Regulations for Virtual Asset Providers

Argentina’s CNV has finalized regulations for VASPs, emphasizing user protection and compliance in cryptocurrency transactions. Key requirements include registration, cybersecurity, custody obligations, and risk disclosures. Firms must meet set deadlines to continue operations, reflecting a broader trend of increasing crypto adoption in the country amid economic fluctuations.

Argentina’s securities regulator, the National Securities Commission (CNV), has established finalized regulations for virtual asset service providers (VASPs). Published on March 13 as General Resolution No. 1058, these rules encompass conduct codes and custody mandates specifically tailored for cryptocurrency exchanges and platforms engaging in digital asset transactions. The purpose of these regulations is to ensure transparency, stability, and user protection within the crypto ecosystem.

The regulations outlined significant obligations for VASPs, including registration, cybersecurity measures, asset custody protocols, anti-money laundering strategies, and risk disclosures. Argentine tax lawyer Diego Fraga has noted that these guidelines necessitate the separation of client and company funds, conducting annual audits, and submitting monthly reports to the CNV.

Effective from 2024, VASPs in Argentina must register with the registry of virtual asset service providers (PSAV). The regulations state that failure to comply may result in revoked registrations, and entities operating without registration could face court restrictions. Entities registered with the PSAV are granted until July 1 to meet the new rules, while domestically incorporated firms have until August 1 and foreign entities until September 1.

Roberto E. Silva, the CNV’s president, emphasized, “Those who do not comply with the established requirements and deadlines will not be able to operate in Argentina.” The CNV’s regulatory efforts gained momentum last year, responding to increasing crypto adoption as residents sought refuge from the depreciating peso.

Despite recent controversies such as President Javier Milei’s endorsement of the LIBRA memecoin, which experienced a value crash, Argentina has seen a surge in cryptocurrency adoption. A Chainalysis report indicated that Argentina surpassed Brazil to become the largest Latin American nation in crypto inflows, with approximately $91 billion recorded between July 2023 and June 2024.

In conclusion, Argentina’s National Securities Commission has implemented comprehensive regulations for virtual asset service providers aimed at ensuring user protection, transparency, and stability within the cryptocurrency landscape. The regulations enforce strict compliance measures, including registration, cybersecurity, and asset management protocols, to mitigate risks associated with digital asset transactions. These developments occur in the context of rising cryptocurrency adoption in Argentina amidst economic challenges, despite some regulatory controversies.

Original Source: cointelegraph.com