In Argentina, cryptocurrencies have had a surprising boom. This country is one of the early adopters of bitcoin. Many Argentinean ventures have been based on blockchain technology, such as MercadoPago or Flixxo. Also, the government of Macri has promoted initiatives such as supporting the investment of startups based on Blockchain or allowing pay public transport with bitcoin.
Leo Elduayen, co-founder and COO of Koibanx, affirmed that despite this favorable situation, Argentina lacks a regulation for the Blockchain. According to Elduayen, the little knowledge of the subject by the State has caused this lack.
In an interview for Cointelegraph, Elduayen said that regulators often make the mistake of regulating technologies, instead of regulating uses and their principles. He gives the digital signature as an example:
“Today we have an advanced electronic signature, a stamp in Blockchain, an electronic signature certified in Blockchain, but no account with the legal validity of the digital signature. This is so, despite having equal and even superior technical and security elements, thanks to technological advances. The regulator should focus on creating regulations that are not obsolete over time, or at least not as assiduously. Technology inevitably advances at a different speed; what we should foresee is how to regulate uses regardless of the technology they use. “
“First of all, regulators should educate themselves. It is always the first step and the basis of everything, “he said.” Argentina has some good examples in this regard. For example, the innovation table of the Central Bank of the Argentine Republic (BCRA) or now the Task Force Fintech of the National Securities Commission (CNV), “.
Countries with a regulated Blockchain
Currently, few countries have legislation that regulates Blockchain technology.
In 2017, the President of Belarus signed an ordinance, becoming the first country to regulate the use of the Blockchain. The act, which came into force in 2018, created an exclusive zone in the country where it allows technology companies to use Blockchain and cryptocurrency. The purpose of this law was to prevent the financing of terrorism and money laundering.
The United States has a wide adoption of blockchain technology, but in terms of laws, the issue can be complicated. The regulations on cryptocurrency and Blockchain are usually related. Although cryptocurrencies are accepted at the federal level, there are also local laws on usage.
Malta is known as the Blockchain Island, where the potential of this technology is considered very broad. Recently the government approved two laws focused on establishing standards and regulating the entry of new Blockchain players.
Gibraltar, British overseas territory in southern Spain, has worked since 2014 on legislation for companies that use Blockchain. In January 2018 it came into force and established nine principles that all companies must follow.
How should Blockchain be regulated in Argentina?
Elduayen believes that first regulators should educate themselves on the subject, in addition to conversing and understanding the problems of companies, users, and customers. Therefore, the regulatory framework should focus on two points:
“In the first place, really carry out the appropriate cost-benefit analysis that is sought to promote with public policies. In short, our legislative system is nothing else than the set of incentives and punishments that we try to encourage in our society. In a context where a technology that allows us to solve several financial problems and money management we have, what decision should we take as a regulator? Prevent its flowering because they fail to comply with rules of prevention of washing and out of practice? On the other hand, the second point that we need from our regulatory framework is legal certainty, understanding certainty as clear and safe knowledge “.
“If this technology allows us to solve a lot of the financial problems with which we find ourselves today. However, there is no precise and secure knowledge about the consequences of using it (criminal, fiscal and commercial), or if it changes to the pleasure of the regulator in turn, we will not be able to exploit the benefits that these technologies bring with them, “reflected Koinbanx’s director.
Just as in Mexico the Fintech law has allowed legal certainty to financial startups, in addition to promoting their development, legislation for the Blockchain in Argentina can serve to boost its competitive technological ecosystem, opening new opportunities to innovate.