The South American country of Argentina has announced key updates related to digital assets.
Argentina’s National Securities Commission (CNV) has implemented the Registry of Virtual Asset Service Providers (VASPs). The LatAm based nation has some of the highest levels of crypto adoption globally so this update is fairly standard and meets the expectations of regulators and businesses.
On 25 March 2024, the CNV issued General Resolution No. 994/2024, which will regulate the Registry of Virtual Asset Service Providers in accordance with the provisions of Section 38 of the updated Law No. 25246.
This Law reportedly included virtual asset service providers (VASPs) as AML/FT-regulated entities.
On 15 March 2024, Law No. 27739, which updates the legal framework to prevent illicit activities like money laundering, terrorism financing as well as the proliferation of weapons of mass destruction, was introduced, thus it significantly modifies the related regulations.
One of the key amendments intended to define virtual assets and VASPs and include them as reporting parties before the Financial Information Unit.
The CNV also introduced the Resolution through which the conduct of VASPs is to be regulated. The Resolution offers these updated rules:
Human and legal persons residing or based in Argentina and carrying out one or more of the activities or operations included in Section 4 bis of the Law as amended will need to register with the Registry before performing those activities or operations.
And the activities mentioned in said section of the Law are: (a) exchanging virtual assets and legal tender currencies (fiat currencies); (b) exchanging one or more forms of virtual assets; (c) transferring virtual assets; (d) having custody and/or administering virtual assets or instruments that allow control over them; and/or (e) participating in and providing financial services related to the offer of an issuer and/or the sale of a virtual asset.
Human and legal persons based outside the South American nation of Argentina that are performing such Activities need to register with the Registry prior to carrying out those Activities, provided that they perform them under any of the following modalities: (a) they use any “.ar” domain to carry out their Activities; (b) they have commercial agreements with third parties, subsidiaries or related parties that allow them to locally receive funds or assets from Argentine residents to perform the Activities (or any activity similar to those known as ramp services); (d) they clearly target Argentine residents; (e) they carry out advertising campaigns clearly aimed at Argentine residents; and/or (f) their turnover in Argentina exceeds 20% of their total turnover. For this purpose, only the total turnover of the activity or activities for which the company must be registered shall be considered.
VASPs must provide pertinent information and documentation as stated in the Resolution to register with the Registry.
The Resolution states that VASPs that carry out the Activities are exempted from the obligation to register with the Registry provided that they do not exceed, on an aggregate basis, an amount equivalent to 35,000 UVAs (acquisitive value units) per calendar month.
The Resolution also states that registering with the Registry does not imply that the CNV will grant a license over the Activities.
As stated in the announcement, VASPs covered by the Resolution that, as of the date of its entry into force, are carrying out any of the Activities must apply to register with the Registry within 45 days of the Resolution’s entry into force.
The Resolution became effective on 25 March 2024.