Amid the increasingly regulatory controversy that emerged in Argentina two years ago as the result of the lack of a regulatory policy, we find ourselves at battles in several fronts. Banks attempt to discourage FinTech expansion; FinTechs aim to make all sort of business and to transact freely with certain users and investment funds and; lastly, regulatory agencies such as the Banco Central (BCRA) (Central Bank), the Comisión Nacional de Valores (CNV) (National Securities Commission), the Unidad de Información Financiera (UIF) (Financial Information Unit) and the Administración Federal de Ingresos Públicos (AFIP) (Federal Administration of Public Revenue) must pursue regulatory compliance to ensure legal transactions and the state control over all transactions in such a dynamic (financial) universe that demands a quick reaction.
In this article we will consider some of the hottest topics today. The discussion over the interoperable QR and 3.0 transfers that enabled FinTech a better interaction with bank funds is an issue of the past. For a better idea of the BCRA rule that settled the matter, we recommend to enter the following link.
Communication BCRA A7030 and its constitutionality
For almost a year the State has been seeking to identify crypto users through new legal rules. As reported by iProUp in this article of April 2021, the debate seems to have scaled and was even brought to court through a collective habeas data. The debate was also covered by the international media CoinTelegraph. The habeas data action was founded on Act 25.326 that protects personal data, arguing that the rule broadly exceeds the information regime that an entity such as the Central Bank requires to carry on its duties. Three basic principles of mentioned act have been breached (according to the plaintiff): “The purpose for which such information is collected (data must be collected for a certain purpose), information (whenever personal data are required, data owners shall be previously notified in an express and clear manner) and consent (with which I partially agree); it is true that the Organic Charter of the BCRA says nothing about controlling transactions (and nothing at all about cryptoassets). The main concern is the appearance of “black lists” or database showing individuals holding or having hold cryptoassets with discrimination effects (although for some people it can be absurd, cryptocurrencies were designed to keep money and the value thereof completely independent from any state control).
We have to bear in mind that the general principle is that public agencies shall request information only when irregular activities are suspected; no personal data can be requested universally in a massive way. An important detail is that this information is requested by the BCRA only from banks and financial agencies, not from exchanges for the time being (AFIP is a different case).
As regards methodology, the plaintiff states that it would be extremely difficult and ineffective for all persons affected by the rule to go to court individually. However, it is quite strange that the lower court rejected the complaint without a deep analysis of the situation.
The State declares that data are requested for a deeper evaluation of a legal framework for the use of cryptoassets. If so, information should be requested for statistics purposes only, keeping anonymity of crypto ownership and avoiding disclosure of identities.
Even though in this case we are making reference to an information request, it is quite concerning the enactment of minor rules regarding cryptoassets without a clear legal framework defining them. Some of the aspects requiring regulation are their use as financial assets, as medium of payment, mining, investments regime and financial education in order to provide information to crypto users. There is no current legislation today concerning these aspects. The National Government as well as the provinces seem to be focused only on the information regime over investors for tax purposes.
To conclude, my opinion about “the end of the story” is the one given to the specialized media on April 2021: “The Central Bank is vested with investigation powers and is requesting from banks to disclose the identities of such persons who transact or have transacted with cryptocurrencies. This information, once provided, will be available onwards for any tax survey. I believe an intermediate position should be approached between the Central Bank requirements (detailed and complete information on natural and legal persons transacting with cryptoassets) and the top secret condition. The reasonable course of action should be to carry on a thorough investigation when illegal activities are suspected.”
