Cuba’s central authorities declared that the Bank of Cuba will be responsible and look after the usage of cryptocurrencies in the island country. Cuba is announced a legal framework to control and regulate cryptocurrencies.
Bank of Cuba Regulates Cryptocurrency
The government of Cuba announced on Thursday that the country will recognize the use of cryptocurrency. However, the digital asset will be heavily regulated by the Bank of Cuba, an institution that looks after the monetary and banking matters in the island nation.
The bank of Cuba is now accepting cryptocurrencies and Bitcoin as regulated money. It issued a set of laws and a legal framework has been formulated to keep cryptocurrency under control and maintain investor protection.
The use of cryptocurrency by individual entities and organizations such as crypto service providers will be operational only after legal licensing. The Bank of Cuba is the solitary agency responsible for the allowance and approval of licenses for anyone to trade and exchange cryptocurrencies and other digital assets and securities.
As per the fourth article of the law, all digital coins and cryptos activities should be supported and authorized by the Bank of Cuba. There is no space for federal power, no state authorities will be able to use cryptocurrencies for making transactions and trade without being authorized by the foundation. Additionally, customary financial structures like banks should configure measures to keep their foundation from being utilized for crypto-related financial activities.
The digital cryptocurrency has become a popularly used currency in Cuba among the tech-savvy groups. This is not only the consequence of the developing arena of digital finance and other technological developments but, it is also due to the embargo on dollars put by the USA under the governance of former president Donald Trump. However, matters haven’t been merry with the US after Biden’s Presidency. As per a report by Reuters, Cuba in July 2021 had “temporarily stopped accepting cash bank deposits in dollars, blaming tighter U.S. sanctions.”
In such circumstances, recognizing Bitcoin and cryptocurrency as legal tender bears two-fold beneficiary factors. Formerly, “for reasons of socioeconomic interest” and next is the advancing technological growth promoted by this provision.
The Bank of Cuba made it very clear, that criminal offenses and financial transgression using cryptocurrency won’t be tolerated. Although any penalties or retribution that unauthorized cryptocurrency users and service provides will face weren’t mentioned directly. But in the eighth article in their regulatory law, it says, “ Natural persons assume the risks and responsibilities that in the civil and criminal order derive from operating with virtual assets and service providers of virtual assets that operate outside the Banking and Financial System, even when transactions with virtual assets between such persons are not prohibited.”
A Cuban cryptocurrency expert who uses his socials to spread awareness about cryptocurrency – Erich J Garcia Cruz opined on Twitter regarding his country Cuba legalizing well-regulated cryptocurrency, “Yes, I am Cuban, yes, I use cryptocurrencies a lot, yes, I am a natural person. I am going to request the necessary licenses to operate with that digital asset. I live in Cuba and I must comply with the laws of Cuba.”
He also feels “Neutral” about this change.
After El Salvador, Cuba made Bitcoin and cryptocurrency legal tender. Is this the start of a new approach to the acceptance of cryptocurrency and digital financial assets? Only time will indicate.