Cointelegraph reports that the fiscal regulator has taken drastic measures in order to protect the foreign exchange reserves of Argentina which has been under immense stress following months of high inflation rates which has led to the slump in the country’s currency, the peso.
The new measures were contained in a communique from the banking authority which included various sectors whereby credit card usage was either limited or banned.
The part that dealt with the crypto sector stated,
“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.”
At the moment, it is still not clear if the prohibition by the central bank were meant only for credit cards or if it also affects debit cards. The mentioning of bank transfers brings the notion of peer-to-peer transactions provided that no foreign money enters into Argentina.
The central bank is hopeful that through introduction of restrictions in various sectors, it can have a tight grip on foreign exchange affairs. At the start of this week, the banking authority reduced the maximum dollar purchase limit for its citizens to only $200. This represents a decrease of 98% from the earlier $10,000 that was set at the beginning of October. At the time these measures were introduced, the value of Bitcoin trading increased sharply and the measures introduced are meant to deal with this phenomenon.
Bitcoin, although being seen as volatile in nature, has increased in value by about 150% from the start of the year. This means that it represents a better store of value in Argentina than the peso under the current regime of volatile inflation rates. The restriction on the usage of the US dollar within Argentina can easily be circumvented by adopting a crypto that is widely accepted like Bitcoin or Ether.