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Crypto Regulations in Argentina 2024
In recent years, the usage of cryptocurrency has witnessed a rapid surge in popularity across various regions worldwide, and Argentina is no exception. As of 2024, it is estimated that over 1.3 million people in Argentina utilize crypto, which translates to approximately 2.94% of its population adopting this digital currency.
Interestingly, since 2019, the country has taken a significant shift towards creating a timeline for Bitcoin acceptance and other alternative assets. However, Argentina exercises strict controls over foreign currencies to safeguard the nation from inflation and circumvent prohibitions and transfers of foreign currency outside its borders.
Regulatory Environment in Argentina
It is essential to note that cryptocurrencies are not legal currency in Argentina. This means they do not meet the criteria as issued by the government monetary authority and are not a legal tender in the country. It is only the Central Bank of Argentina that has the authority to issue legal currency within the country.
Regulatory Developments in 2022
In a shocking turn of events, Argentina’s central bank banned unregulated crypto transactions from being processed through traditional banks on September 5th, 2022. This drastic measure was reportedly brought about by pressure from the International Monetary Fund (IMF).
Additionally, on May 5th, the Central Bank of Argentina announced it had prohibited banking institutions in the country from offering services to clients for digital assets that have not been regulated by the central bank.
Regulatory Framework
In Argentina, cryptocurrencies like Bitcoin are classified as a digital representation of value which can be used to trade digitally, serving as a medium of exchange, unit of account, and store of value. However, they do not possess legal tender status within any jurisdiction or government agency in Argentina.
Taxation of Crypto Gains
Regarding taxation, it is essential to highlight that if the issuer resides or is located in Argentina, income derived from crypto holdings or disposal would fall under a scheduled tax rate of 15% for resident individuals. For non-resident entities, this rate is not applicable.
It’s crucial to note that residents and legal entities are taxed at a general progressive income tax rate between 25-30%, depending on the source of income and residency status.
Moreover, in Argentina, any transfer or exchange of virtual currency does not fall under Value Added Tax (VAT).
Mining Cryptocurrencies
Interestingly, mining cryptocurrencies is legal and popular in Argentina due to its low-cost, subsidized electricity. This has led to a town, Sorradino with 6,000 residents exploring crypto-mining as a means of generating income. The revenue generated from this activity will be converted into the country’s fiat currency for infrastructure renovations.
In conclusion, cryptocurrencies are legal but not considered legal tender in Argentina. They are regulated for taxation and anti-money laundering purposes.
Source: coinpedia.org
