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Buda Cryptocurrency Exchange Loses All of Its Colombian Bank Accounts

The Buda cryptocurrency exchange has lost all of its bank accounts in Colombia, effectively disabling its cryptocurrency operations in the South American nation. Bancolombia, BBVA, and Davivienda simultaneously closed Buda’s bank accounts on 7 June 2018.

The Financial Supervisor of Colombia sent out a letter in February indicating that cryptocurrency exchanges in Colombia were under surveillance and that banks are not authorized to facilitate any cryptocurrency activity. The CEO of Buda in Colombia, Alejandro Beltran, said that he thought this letter was a recommendation and the banks had no official obligation to comply. However, the wording in the letter is very strong, and Colombian banks are now clearly complying.

Buda has also been experiencing similar issues in Chile. Banks in Chile attempted to close down accounts associated with all cryptocurrency exchanges operating in the country, but there was a successful legal challenge and Chile’s anti-monopoly court ordered banks to re-open Buda’s accounts. This success is only a temporary order while the case is ongoing.

Buda is a cryptocurrency exchange that primarily facilitates Bitcoin trading, but also has Ethereum, Bitcoin Cash, and Litecoin functionality. Buda is available in Colombia, Chile, Argentina, and Peru. It is obviously very bad news for the exchange that 2 of the 4 countries it operates in are attacking its access to bank accounts, which are essential to facilitate fiat to cryptocurrency trading.

On the upside, even if Buda were to be completely banned in Colombia and Chile it would still be able to operate in Argentina and Peru.

The Colombian senate held a debate on the same day Buda’s bank accounts were closed, and they stated that cryptocurrency and blockchain technology could change the lives of Colombians. They said blockchain could make elections more secure and transparent and help manage public services.

It is surprising that the Buda cryptocurrency exchange lost its bank accounts on the same day that the Colombian senate said such positive things regarding cryptocurrency and blockchain, but it just goes to show that there are many different organizations in any given country’s government, and these organizations often have opposing views.

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Chile Crypto Exchanges Fight Bank Blockade

Following the shutdown of three Chilean cryptocurrency exchanges by banks Itau Corbanca, Bank of Nova Scotia and the state-owned Banco del Estado de Chile, the exchanges have taken their grievances to the appeals court in an attempt to overturn the decision.

Chile’s largest exchanges,, Crypto Market (Crypto MKT), and Orionx are currently blocked from using the banks. Banco del Estado de Chile stated at the time of its decision that it would “not operate with companies that are dedicated to the insurance or creation, brokerage, intermediation or serve as a platform for the so-called cryptocurrencies”.

Before the shutout, Buda facilitated approximately USD 1 million worth of cryptocurrency trades daily. The lawyer representing the exchanges commented that the decision was “an abusive exploitation of a situation of economic independence”.

Although little reason has been offered by the banks, there is a general feeling that the blockade may have originated from the government after Chile’s Financial Stability Council (Consejo de Estabilidad Financiera, CEF) warned of risks pertaining to the use of cryptocurrencies earlier this month.

The appeals court has agreed the hear the exchanged out, although their bank accounts remain closed. According to Bloomberg, Chile’s financial institutions are currently attempting to put a blanket ban on the cryptocurrency industry.

Both BUDA and Crypto MKT issued a public statement titled ‘Chile Can Make A Fool Of Itself Or Stand Out Worldwide’, asking for a transparent stance on cryptocurrencies. They argue that banks in Chile have been shutting down crypto exchange accounts with instructions “not to open an account for anyone” with a connection to cryptocurrencies. The statement argues:

“Due to the lack of knowledge and clarity some banks, out of fear, lack of information, or even poor strategy, are refusing or not offering services to people who are in the cryptocurrency market.”

Guillermo Torrealba, Buda’s chief executive officer, was quoted as saying, “They’re killing an entire industry. It won’t be possible to buy and sell crypto in a safe business in Chile. We’ll have to go back five years and trade in person. It seems very arbitrary.”

The moves by state-owned Banco del Estado de Chile seem to conflict with a recent statement by Susana Jimenez, Chilean minister of energy, announcing that the country’s National Energy Commission would start using blockchain, the technology behind virtual currencies, in its energy sector data.

Despite the relatively small amount of business compared to some of the world’s biggest exchanges which trade up to USD 2 billion worth of cryptocurrency a day, the market in Chile continues to be buoyant.


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