Key takeaways
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Argentina’s central bank is reportedly drafting regulations that would allow banks to offer crypto services.
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The planned change follows the decision to repeal SAB121 in the US.
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Banks are becoming more involved in cryptocurrencies as restrictions on their participation are lifted.
When the Securities and Exchange Commission (SEC) removed a controversial crypto accounting rule in January, it helped catalyze a wave of institutional cryptocurrency adoption in the US.
Now, as Argentina’s central bank considers a similar shift, the Latin American nation is on the cusp of its own SAB121 moment.
In 2022, the Central Bank of Argentina (BCRA) issued Communication A7506, prohibiting financial institutions from “carrying out or facilitating their clients’ operations with digital assets.”
But after Javier Milei appointed new leadership in 2023, the central bank adopted a more pro-crypto stance.
The president of the BCRA, Santiago Bausili, has spoken of the need for Argentina to adopt new financial technologies, arguing that banks and fintech companies should operate on equal terms.
Citing central bank experts, La Nación reported on December 5 that the BCRA is drafting new regulations to ease restrictions on banks’ participation in cryptocurrencies.
The regulatory situation in Argentina is very similar to that of the US.
In both countries, a change of government meant a change of course for cryptocurrencies, as previously hostile administrations were replaced by more accommodating ones.
Although they had a similar effect, A7506 is even more restrictive than the SEC’s Staff Accounting Bulletin 121 (SAB121).
SAB121 restricted cryptocurrency adoption by requiring US banks to report digital assets held on behalf of customers as liabilities.
A7506 amounts to a complete ban on financial institutions offering trading or custody services.
Since SAB121 was repealed, major Wall Street firms have moved to offer cryptocurrency custody, including Citi and State Street, which are preparing to launch the service in 2026.
The banks’ custody moves are part of a broader adoption of cryptocurrencies.
From JPMorgan accepting crypto ETFs as loan collateral to Citi’s stablecoin investments, banks that once kept cryptocurrencies at arm’s length are now incorporating digital assets into their core business lines.
Amid changing regulatory winds, banks interested in cryptocurrencies in the US and Argentina can take inspiration from Europe, where more than a dozen banks offer cryptocurrency trading to retail clients.
Initial measures following the repeal of SAB121 have focused on institutional services and changes in investment policies.