Key Info for Providers and Users #CriptoNews

Argentina is a leader in cryptocurrency adoption, ranking at the top in Latin America for crypto value received, with over $91 billion, according to Chainalysis. The country holds the 15th position in Chainalysis’ Global Adoption Index. Amid this growth, Argentina’s Financial Information Unit has reinforced its regulatory framework, particularly targeting Virtual Asset Service Providers operating within its territory. Global companies like the cryptocurrencies exchange Binance are among those required to comply with these new standards.

To address the sector’s rapid expansion and the financial risks it poses, Argentina’s Financial Information Unit introduced Resolution No. 49/2024 in March 2024. This resolution enforces stringent compliance requirements on Virtual Asset Service Providers to prevent money laundering, terrorism financing, and mass destruction weapons financing. While the resolution became effective in March, a phased compliance schedule extending until August 2025 allows VASPs time to adapt.

Both global and local crypto exchanges will be affected, requiring them to align with enhanced transparency and risk management standards. This regulatory step also aligns Argentina with Financial Action Task Force standards and global best practices, aiming to mitigate the risks associated with cryptocurrency activities.

Assets Regularization of Dollars, Bitcoin, and Cryptocurrencies In Argentina

Argentina is currently undergoing an asset regularization process, known as “blanqueo.” As reported by Infobae on late September, the first phase concluded on October 31. This program allows individuals and companies to declare previously undeclared assets, including bitcoin and other digital assets, by paying a tax.

The ongoing “blanqueo” program and the reporting requirements imposed on VASPs aim to create a more secure process, minimizing the risk of money laundering. The final date to join the Asset Regularization program is April 30, 2025, with the last deadline for submitting a sworn declaration on May 30, 2025.

The Virtual Asset Service Providers Requirements In Argentina

According to a document from Argentina’s National Securities Commission, “Virtual Asset Service Providers are required to report monthly on client account openings and closures, as well as all transactions involving Virtual Assets equal to or exceeding six times the minimum wage.”

Argentina’s Human Capital Ministry set the minimum wage at 262,432.93 pesos, meaning Virtual Asset Service Providers must report any transaction over $1,350. In line with this requirement, VASPs must report all new and closed client accounts, including detailed personal information of account holders, to ensure transparency for individuals engaged in crypto transactions.

These requirements apply to fiat-to-crypto purchases and sales, crypto-to-crypto exchanges, and crypto transfers both inbound and outbound. Transfers into or out of VASPs accounts require comprehensive reporting, with information such as recipient or sender details, public keys, transaction amounts in both cryptocurrency and Argentine pesos, asset type, wallet addresses, and additional optional data for transfers, including the counterpart exchange and sender or recipient ID.

The Potential Impact of the Requirements For Argentina

While these regulations aim to boost Argentina’s economy and improve transparency, they could also lead to increased compliance costs and operational adjustments for VASPs potentially affecting their efficiency to onboard new users.

Additionally, users who have turned to bitcoin, stablecoins, and other cryptocurrencies to escape the peso inflation and avoid reliance on traditional banks might view these requirements as restrictive.

These new regulations could drive users toward peer-to-peer crypto transactions, bypassing VASPs altogether. By circumventing these providers, users may feel they retain greater control, which could challenge the UIF’s ability to monitor transactions effectively.

According to Tumo, a local tax services provider, users are already feeling the impact of new regulations, sparking concerns about how much information local tax authorities will access. “Many of our conversations with prospective clients holding crypto focus on the potential consequences of keeping crypto hidden from tax authorities,” Lucas Martinez, Tumo’s co-founder and Chief Comercial Officer told me in an interview through X direct messages.

“The recent ‘blanqueo’ program has led many to consider whether this is a good time to declare their crypto holdings and avoid penalties. Interestingly, while the Federal Public Revenue Administration —now Customs Collection and Control Agency— and the National Securities Commission introduced these new VASP regulations in March, what caught people’s attention was that Binance also registered as a VASP —an action that some see as opportunistic for the government.”

Despite heightened concerns about platform choice, Tumo notes that many believe the regulation could benefit the industry overall.

As the “blanqueo” program concludes and VASPs reporting requirements solidify, Argentina’s crypto landscape may change. With inflation control measures and new regulations, crypto adoption could shift, and users may become more cautious or discouraged from using digital assets as freely as before.