HONDURAS BANS BANKS FROM DEALING WITH CRYPTO 

The National Banking and Securities Commission of Honduras (CNBS) has enforced a prohibition on crypto handling by the country’s financial institutions due to the absence of regulation. The Honduran central bank lacks the ability to ensure the security of crypto transactions, given their unregulated status, according to the resolution issued.

This resolution highlights concerns about potential risks associated with cryptocurrencies and blockchain-based financial services, including fraud, operational uncertainties, and legal vulnerabilities. As a result, the CNBS has mandated a ban on supervised institutions from engaging in any activities involving cryptocurrencies, virtual currencies, or similar assets.

Additionally, supervised entities are forbidden from holding derivative instruments tied to crypto assets. The resolution mandates the inclusion of crypto asset risks in financial education programs. Notably, crypto exchanges continue to operate without restrictions in Honduras.

Released on February 15, the resolution, approved unanimously, takes immediate effect. The Honduran central bank had previously issued a cautionary statement in March 2022 regarding crypto usage, amid speculations that Honduras might follow El Salvador’s path in adopting Bitcoin as legal tender. The central bank also explored the possibility of launching a central bank digital currency.

Despite regulatory actions, Bitcoin has gained some traction in Honduras. The establishment of Bitcoin Valley in 2022 aimed to attract tourists willing to make payments in Bitcoin, US dollars, or the Honduran lempira. Additionally, Próspera, a city within a special economic zone on Roatan island, adopted Bitcoin as legal tender in 2022 and recognized it as a unit of accounting in January. The impact of the CNBS resolution on these areas remains uncertain.

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