Chilean crypto trading platforms are having a rough time of it as major banks have cracked down on their accounts. With Itau Corpbanca, Bank of Nova Scotia, and Banco del Estado de Chile closing the accounts of crypto Chilean crypto trading platforms Buda, Orionx, and CryptoMarket, the entire cryptocurrency ecosystem in the country is at risk.
Without a banking partner, the crypto trading platforms cannot operate. Without the platforms, traders have no way of buying and selling crypto safely and conveniently.
While Chile’s cryptocurrency industry is not massive, it is growing quickly. Local digital coins such as Chaucha and Luka exist, and their trading platforms – Buda and CryptoMarket in particular – operate in other South American countries.
Guillermo Torrealba, Buda’s co-founder and chief executive officer, says that the banks’ actions are “killing an entire industry.” Without platforms such as Buda in place, crypto trading practices will be set back “five years” – people will have to trade in person. This increases the degree of uncertainty and risk involved.
The trading platforms’ accounts were closed last down without any explanations from the banks, although a statement from Itau Corpbanca Chief Executive Officer Milton Maluhy on March 27 says that “the bank supports startups and new technologies, but cryptocurrency is an industry which still needs more regulation and the bank is following internal norms to decide on closing individual accounts”, Bloomberg reports.
Buda et al. are petitioning the courts to hear their case and allow them to resume operations using their bank accounts. However, the banks have refused to budge and Chilean traders have to find workarounds in the meantime.