Honduras has issued a comprehensive ban on cryptocurrency trading within its financial system, according to a resolution from the National Banking and Securities Commission (CNBS).
The regulation, which took immediate effect upon its announcement on Friday, prohibits financial institutions in the country from engaging in activities related to cryptocurrencies, crypto-assets, virtual currencies, tokens, or any similar virtual assets that are not issued or authorized by the central bank.
This decision underscores the Honduran government’s concern over the risks associated with digital currencies, including fraud, money laundering, and the financing of terrorism.
The CNBS highlighted the challenge in regulating these platforms, many of which operate across various jurisdictions beyond the reach of Honduran law.
Despite the burgeoning presence of crypto trading platforms in Honduras, the country’s laws have yet to accommodate the regulation of crypto assets.
The Central Bank of Honduras has distanced itself from these transactions, clarifying that it does not guarantee or assume responsibility for them.
Interestingly, in March 2022, the central bank revealed it was exploring the potential of launching its own digital currency, assessing both the technical and legal frameworks necessary for such an initiative.
However, a formal decision or announcement regarding this digital currency has not been made public.
The resolution’s impact on Honduras Prospera, a model resort town with its own administrative, fiscal, and budgetary autonomy that declared bitcoin as legal tender in April 2022, remains uncertain.
This development places Honduras among the nations taking a cautious approach to the integration of cryptocurrencies into their financial systems, aligning with global concerns over the stability and security of digital financial transactions.