Bolivian bank Bisa launches a custodial service for USDT

What’s new? One of Bolivia’s largest banks, Bisa, has launched a custodial service for stablecoins. It allows customers to buy, sell, transfer, and use for cross-border payments USDT from issuer Tether, the largest stablecoin in the cryptocurrency market with a capitalization of $120,23 billion.

Material by El Deber

What else is known? The Financial Regulatory Authority (ASFI) supported the bank’s initiative, saying that it allows cryptocurrency transactions to be carried out in accordance with the law, reducing risks to users and the financial system. The Biso bank also noted that customers need to undergo a verification process to use the service.

Bolivia has had a ban on the use of cryptocurrencies since 2014, attributed to insufficient consumer protection and the risk of money laundering. In 2020, the Central Bank banned banks from conducting cryptocurrency activities to protect consumers from fraud and prevent possible economic losses.

However, this year, the authorities have dramatically changed their stance. On July 28, the ban on crypto payments was lifted, and financial organizations were allowed to conduct transactions with digital assets.

The changes are the result of the Central Bank’s collaboration with ASFI and the Financial Investigations Unit (UIF). They are aimed at improving the economy and aligning local regulations with the recommendations of the Financial Action Task Force of Latin America (GAFILAT), which has been pushing for the adaptation of cryptocurrencies.

Bolivia experienced a spike in the number and volume of crypto transactions between July and September. According to a September statement from the Central Bank, monthly trading in virtual assets in the country rose from $7,6 million to $15,6 million.

Cryptocurrency trading in the country is possible through authorized electronic channels, but cryptocurrencies are still not considered legal tender and businesses are not required to accept them as payment. Also, the country has yet to implement a tax base for cryptocurrency transactions.

In addition to lifting the ban, the Central Bank has included information about cryptocurrency risks in its economic and financial education program, which teaches citizens about safe ways to handle this type of asset.