The regulations that legalize the use of bitcoin and other cryptocurrencies for making payments and sending remittances in Cuba have already entered into force.
This Wednesday, September 15, the regulations that regulate the use of bitcoin and other cryptocurrencies in the country came into force. The regulations were published in the Official Gazette of the Republic of Cuba No. 73 last August 26. Said regulation regulates the use of a certain group of digital assets, including bitcoin, for its legal use in commercial transactions, payments and remittances. In addition, it indicates the granting of a license to companies and service providers with cryptocurrencies.
As indicated by the Official Gazette of the country, the Central Bank of Cuba recognizes as “virtual assets” all those digital representations of value that can be marketed or transferred digitally and used for payments or investments.
At the time of its publication, the Central Bank indicated that the legalization of the use and payments with Bitcoin (BTC) and others cryptocurrencies It was carried out for reasons of socioeconomic interest, so financial institutions and legal entities were authorized to carry out commercial operations with these types of assets. Thus, with the regulations in force since yesterday, the entities authorized by the Central Bank can now legally carry out commercial operations with cryptocurrencies among themselves and with natural persons. Organizations of another type present in the country must be previously authorized by the Central Bank, before operating with cryptocurrencies.
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Cuba, crisis and Bitcoin
Cuba is facing one of the worst economic crises seen in history. In 2020, the year of the pandemic, the island country saw its Gross Domestic Product (GDP) fall by 11%, which accentuated the adoption of bitcoin and cryptocurrencies by its citizens. The main uses that Cubans give to crypto assets are sending remittances and commercial payments.
With the spread of the Covid pandemic worldwide and health restrictions, cryptocurrencies became the main means of sending money to Cuba. Since last year, the use of crypto assets in the country has increased significantly, which is why the government made the decision to regulate and legalize the use of these digital assets within its territory.
Adoption of cryptocurrencies in America
In America, mainly in Latin America, the adoption of bitcoin and cryptocurrencies has been growing rapidly. Citizens of developing countries and with a notable level of economic crisis, such as Venezuela and Argentina, are the ones who use cryptocurrencies the most.
In these territories, digital assets have become the way to escape the restrictions and abuses of governments and central banks, as well as a means to receive and transfer value safely, immediately, cheaply, cross-border and, above all, free of prohibitions. In fact, in his last crypto adoption reportthe blockchain analysis firm Chainalysis places Venezuela and Argentina in 7th and 10th place among the countries with the highest adoption of cryptocurrencies globally, respectively.
ETFs and legal tender
Residents of other countries such as Paraguay, Brazil, and Colombia are also showing great interest in cryptocurrencies and digital assets. In fact, Paraguay recently presented a bill to regulate bitcoin and cryptocurrencies; Brazil is making progress in crypto adoption and is the first country in Latin America to launch exchange-traded investment funds (ETFs) for Bitcoin and Ethereum; while Colombia advances in a regulatory sandbox that involves its main banks and financial entities with the exchanges of the best-known cryptocurrencies in the industry.
Interesting times are also being experienced in Central America for the crypto industry. El Salvador is the first country in the world to make Bitcoin its legal tender, while Panama is looking at possible regulation for the industry to encourage investment and boost its growth.
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