Cubans are bypassing financial sanctions using crypto

Cuba’s central bank will provide licenses to crypto service providers

Cuba’s central bank will provide licenses to crypto service providers and will be valid for a year. Service providers can get these licenses extended for an additional year if needed. The central bank will issue licenses to the national and foreign organizations and individual people. There have been no details on what will happen after the licenses expire after 2 years. Will, new licenses need to be acquired, or there would be a different procedure in place.

The licenses for crypto service providers

With the licenses service, providers can dabble with virtual assets that are approved by the Central Bank of Cuba. The definition of these assets hasn’t been defined yet, but it does state what categories do not fall under this. Fiat currencies in digital format, securities, or any other asset that is a part of the traditional financial system shall not fall under the virtual asset category.

Cuba's central bank will provide licenses to crypto service providers
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While a licensing system seems fair and good for regulatory oversight, the fact that only the approved assets can be dealt with is concerning. Now, whether this entire policy will be positive or not will depend on what criteria the Central Bank qualifies virtual assets.

Companies that put forward a request for these operating licenses will be approved or denied within a 90-day period from the date of the documentation. The central bank will also consult its crypto-asset group before issuing these licenses. Exchnages that are unable to acquire these operating permits might have to shut down their operation in the country.

Crypto adoption in Cuba

It is difficult to give an exact adoption rate of cryptocurrencies in Cuba, but the country is definitely seeing growth. Popular exchanges in the country have seen a massive increase in volume in 2021. COVID-19 was also one of the main reasons for this growth as people became more dependent on digital platforms to generate income. It has also become an important medium for families in the country to receive money from family members or relatives working abroad.

Do you think crypto oversight will get better as Cuba’s central bank will provide licenses to service providers? And do you think it is good for the industry? Let us know in the comments below. Also, if you found our content informative, do like and share it with your friends.

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