Private Banks in Argentina are starting to see the value of offering cryptocurrency services to their customers amidst a crypto boom in the country. Brubank, an all-digital financial institution licensed by the country’s central bank, has reported it is now offering cryptocurrency purchase services in its app. The bank announced this new functionality on social media when answering an inquiry from a customer about the new options on the platform.
Yes, we already have crypto! It is a functionality that is being progressively enabled for all our users. When you have it enabled you will be able to view it by entering ‘Investments’ from the app.
Legality of the Banking Crypto Frenzy
Brubank is not the first banking institution to include cryptocurrency services for its customers in Argentina. On May 2, Banco Galicia, another private bank, also announced it was already offering cryptocurrency investments directly from its home banking app, after noting a demand for these instruments from customers.
However, cryptocurrencies are still not regulated in the country, and banks cannot offer cryptocurrency investments by themselves. To do this, banks are partnering with third-party institutions that operate outside the country, offering white label services. In the case of Banco Galicia, it is Lirium, a European regulated platform, that provides the liquidity, executes the trades, and provides custody services for the customer of the bank. Brubank has not yet announced which platform is providing these services for the institution.
The nature of such arrangements means that the funds stored in these cryptocurrency wallets are not secured by the laws of the country, and are out of the scope of the protections that institutions of the country, like the central bank or the National Values Commission, can offer for investment instruments.