The non-government organization “Bitcoin Argentina” has proposed a draft bill aimed at regulating the cryptocurrency market. This move, contrary to their previous stance, emphasizes the need to balance regulation with the preservation of decentralization and the establishment of public trust.
Reassessing Regulation: A Shift in Perspective
Bitcoin Argentina’s president, Ricardo Mihura, unveiled the proposed legal framework at LABITCONF 2023 in Buenos Aires on Nov. 10. The organization, which had previously rejected the idea of regulating the crypto industry, now argues for a nuanced approach. Mihura explained,
“We have always rejected attempts to regulate the crypto economy, but this time we set ourselves the goal of giving a positive response, with only two purposes: preserving decentralization and protecting savings and public trust.”
Categories for Accountability and Protection
The first key aspect of the proposed legal framework is the categorization of cryptocurrency platforms and service providers. The framework suggests dividing them into three categories based on their approach to property rights: decentralized, local centralized or open to dialogue with authorities, and global centralized.
Platforms falling into the centralized categories would be allowed to operate freely, but customers would be granted the “broadest possible judicial protection.” This ensures the right to claim damages in case of a company’s failure. Notably, decentralized platforms are expected to be exempt from judiciary interventions in case of failures.
Decentralization and Global Challenges
Mihura emphasized the global nature of blockchain, stating that even imposing an outright ban on cryptocurrencies would be ineffective. He pointed out,
“Not even the United States can effectively prohibit the operation of the unlicensed crypto economy […] Argentina has no possibility of prohibiting its residents from operating in global environments.”
The proposed bill also addresses the issue of dishonest actors within the blockchain space. Mihura stated,
“We cannot close our eyes to the number of dishonest actors and projects that circulate with the blockchain brand.”
The bill aims to hold bad actors accountable, including those directly responsible and all those who profit in the marketing chain of a fraud, until the final victim.
Context of Argentina’s Economic Landscape
Blockchain Argentina’s proposed bill comes at a critical time, just one week ahead of Argentina’s presidential run-off election. The country is currently grappling with an inflation crisis, recording the fourth-largest annual inflation rate in the world at 121.7% over the last 12 months.