The Central Bank of Argentina has recently banned the purchase of Bitcoin and other cryptos using credit cards. This development comes after Argentina recently introduced limits on US dollar purchases. Moreover, this will likely severely impact Argentinian citizens from purchasing cryptos.
Argentina prevents citizens from buying crypto using credit cards
This news first came from Cointelegraph Brazil on November 1st. Furthermore, the measures were also reported in an official central bank communication. The communication included a number of different industries in which credit card use will now be either limited or prohibited altogether.
Furthermore, the section of the message concerning cryptocurrencies states that Bitcoin will not be able to buy with credit cards. Instead, Argentinians will need to buy their crypto using their native bank account moving forward:
“Acquisition of Bitcoin and cryptocurrencies: It is prohibited to purchase BTC with this payment method. The only remaining alternative for this investment is to do so with funds transferred from a bank account.”
In addition to this, there is some uncertainty regarding whether this also includes debit cards. Seeing as the official statement refers to bank accounts as the sole alternative for buying crypto, this could be true. Moreover, this would also likely mean that prepaid cards are also no longer an alternative.
This comes as a US dollar exchange reduction spikes Bitcoin trading
It is not clear exactly why Argentina’s central bank decided to ban credit card payments. However, the organization has said that the measures are integral to preserving Argentina’s foreign exchange reserves. One could easily be led to believe that this comes a more or less overt way to promote Argentina’s fiat currency.
The fact that this follows a recent ban on US dollar purchases in the Latin American nation is also notable. Experts suggest that this all boils down to the fact that Argentina seeks to block the entry of dollars into the country.
As such, Argentina is looking for stronger exchange control. Bitcoin and other cryptos could naturally allow Argentinian citizens to escape this increasing state control. Specifically, the Central Bank of Argentina imposed a new limit on US dollar purchases earlier this week, which reduced the maximum amount from $10,000 to a mere $200.
This decision has also been attributed as causing a spike in Bitcoin trading. It would, therefore, appear that Argentina is now trying to prevent citizens from seeking refuge to cryptocurrency havens as the fiat currency exchange situation in the country sees some instability.
Rasmus Pihl is a writer for Toshi Times by day and an avid follower of the blockchain industry by night. Rasmus holds a Bachelor’s Degree in Marketing from the Gothenburg School of Business, Economics, and Law and runs a Swedish marketing consulting firm. Moreover, when he isn’t writing for Toshi Times, traveling, working or changing the world in some other capacity, Rasmus is more than likely caught up in postgraduate studies.