While the startup is looking for a permanent solution, it has found a temporary fix. As Buda.com recently announced a way to continue crypto-transactions thanks to its partnership with fellow Colombian fintech, Tpaga.
Buda.com (sorta) returns
Buda.com’s users were unpleasantly surprised in June of 2018 to realize they had limited access to transactions on the platform. As it turned out, Buda.com’s bank accounts had been closed, so cryptotrade was no longer possible.
Apparently local banks took it upon themselves to close accounts linked to cryptocurrencies. The motive behind this move was an old government notice that warned of the risks of cryptotrade. Nonetheless, it’s important to point out that this same notice didn’t order banks to act as they did.
Leading crypto platforms are no strangers to this treatment. They have previously found their bank accounts had been blocked before by banks in this country (with no prior warning or explanation).
But last year’s shut down directly hurt users, according to Diario Bitcoin. What’s unusual about this case is that other Colombian crypto-exchange platforms like Panda Exchange weren’t hit.
On Tpaga, users can change their Colombian pesos by credit, debit card or online transfer to cryptocurrencies via the platform’s payment option and the displayed QR code. From there, Buda.com handles the conversion and management of those assets.
Meanwhile, in Chile…
Bank accounts linked to Buda.com were also closed in Chile in March of last year. There’s an ongoing litigation over the issue.
However, by May, a local court had ruled that the blockage violated the startup’s rights. The judge deemed that banks had arbitrarily blocked these accounts and, consequently, ordered they be reopened until the affair is settled.
So, for the moment, all is good.
As digital currency trade rises throughout Latin America, no government wants to be the crypto killjoy and limit its use by strangling the startups that partake in it. The global nature of cryptocurrencies also complicates regulation. Some steps have been taken.
For example, Mexico’s fintech law was an important step in putting some sort of legal framework around cryptocurrencies. Meanwhile in Chile, Peru, and Colombia, authorities are more ambiguous. The general trend is that these assets are allowed to circulate; they just aren’t recognized by the law.
Governments everywhere do show interest in seeing how cryptocurrencies can benefit their people. Nevertheless, the usual concerns in the risks involved with this emerging tech persist.
As the use of crypto continues to flourish, governments won’t be able to delay regulation much longer. That—or wait for something to go wrong.