Bitblue Crypto Exchange Accounts to be Shut Down by Brazil’s Bradesco Bank By End of Month
A large Brazilian bank has told the Bitblue cryptocurrency exchange that its accounts will be shuttered on February 26th.
A local news outlet in the South American country learned about the decision Brandesco levied on the Bitblue exchange. Account closures will also pertain to the private accounts of Bitblue’s owners.
Brandesco’s decision has already been reported to the Brazilian Administrative Council for Economic Defence by the Association of Crypto and Blockchain. The Association said the decision to close the accounts violated free competition rules.
Bitblue CEO Edisio Pereira said the company will not appeal against the decision by the bank since it has had accounts with other financial institutions. However, Bitblue co-founders and partners will appeal since account closures can impact their reputation going forward.
The Brazilian Administrative Council for Economic Defence has launched a couple of investigations pertaining to alleged monopolistic crypto industry practices. It launched a probe against six leading Brazilian banks back in September 2018.
A month later, the Council issued a questionnaire to ten crypto companies who said their rights were violated by Brazilian banks. In the latter part of last year, Banco de Brazil and Santander Brazil re-opened Bitcoin Max’s accounts after a ruling by the Federal District Court, who said the two banks did not notify Bitcoin Max before closing its accounts.
The lawyer for Bitcoin Max managed to get the company’s appeal approved after a judge originally denied the exchange’s motion. Judge Ana Catarino originally said the bank could close any account it wanted, but she accepted an injunction from Bitcoin Max after lawyer Leonardo Ranna was able to prove it did not provide a formal notice before closing the accounts.
However, some think the victory by Bitcoin Max was a small one (if that), since it was only due to a loophole that it managed to have its accounts re-opened.
Speculation is other exchanges could have a much tougher battle if their accounts are closed by Brazilian banks.
Losing access to banks in the country is a huge problem for any company looking to carry out Bitcoin transactions because they will become unable to offer the local currency. Many think a lack of stronger market regulations, particularly some that give more power to exchanges, will hurt crypto companies in the long run and threaten local markets.