Crypto exchanges in Brazil may soon lose banking support as a major commercial bank has refused to abide by an agreement preventing the closure of cryptocurrency exchange accounts. Across Latin America, crypto trading platforms continue to experience difficulties maintaining banking relationships.
Banco Bradesco Ignores Agreement to Stop Crypto Exchange Account Closures
According to Hispanic cryptocurrency news outlet Criptonoticias, Banco Bradesco — one of Brazil’s major commercial banks, is refusing to honor any agreement preventing the closures of crypto exchange accounts.
Back in late December 2019, Brazil’s Administrative Council of Economic Defense (CADE) ruled that it was not illegal for banks to withdraw services from crypto exchanges. At the time, CADE argued:
There is no evidence of antitrust crimes as a result of the rejection of some banks to establish contracts with certain cryptocurrency exchange [platforms].
CADE’s December 2019 ruling was a departure from its previous stance that such actions included sufficient anti-trust elements. In response, the Brazilian Association of Cryptocurrencies and Blockchain (ABCB) described the ruling as being full of “darkness, contradictions, and omissions.”
For Banco Bradesco, digital assets pose serious money laundering risks. Thus, the bank is reportedly choosing not to abide by any demands from the ABCB regarding account closures for crypto exchanges.
Apart from Banco Bradesco, other commercial banks are also moving ahead with shutting down accounts belonging to crypto exchanges. Sao Paulo’s Court of Justice recently dismissed an appeal filed by Mercado Bitcoin — a Brazilian crypto exchange, against Bank of Brazil following the decision by the latter to close down its bank accounts.
As previously reported by Bitcoinist, Bitcoin Max, another Brazilian crypto exchange, won a court battle to keep its accounts with Santander Bank.
Latin American Exchanges Under the Cosh
The situation in Brazil appears to be symptomatic of the established trend across Latin America especially in countries like Chile. As reported by Criptonoticias, Banco de Crédito e Inversiones, one of Chile’s commercial banks, has shut down accounts belonging to crypto exchange, Chilebit.
Back in April 2018, Chilean crypto exchanges obtained a reprieve as the Appeals Court ordered banks to reopen their accounts. At the time, crypto stakeholders in the country railed against the trend of banks refusing to offer banking support to virtual currency exchanges.
However, in December 2018, Chile’s Supreme Court ruled in favor of Chile’s state-owned bank, justifying its decision to shut down the account of the crypto exchange Orionx.
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