Crypto License in Argentina

Argentina is one of the leading countries in Latin America in using cryptocurrencies, although its laws in this area are still being formed. This leads to different government agencies setting their own rules and clarifications.

Many Argentines are turning to cryptocurrencies due to high inflation and the depreciation of the national currency. As a result, Argentina ranks second in the region for cryptocurrency activity after Brazil and thirteenth in the world.

The growing popularity of cryptocurrencies has led to a thriving ecosystem of crypto startups and companies in Argentina. These organizations involved in blockchain development, cryptocurrency applications, and exchanges play an important role in providing innovative solutions to the economic challenges of the population. As of 2024, many crypto startups are operating in Argentina, helping to integrate digital currencies into the mainstream financial landscape. These companies include Ripio, SatoshiTango, Decrypto, Lemon, and Koibanx.

Buying and holding cryptocurrency is not prohibited in Argentina, but the previous government imposed restrictions on its use. There is regulation at the national and provincial levels that covers increasing activities but discourages certain uses. For example, Argentina’s Central Bank considers cryptocurrencies to be liquid external assets, which restricts individuals and companies from accessing the foreign exchange market if their assets exceed $100,000.

Also, cryptocurrencies were not recognized as legal tender until 2023. This may change after the arrival of new President Javier Miley in December 2023, who supports liberal economic policies, and may loosen the current rules. For example, just 10 days after Miley took office, Argentina officially authorized the use of Bitcoin in legally binding contracts on December 21, 2023.

At the same time, the Argentine government is now seeking to control and restrict the use of cryptocurrencies to prevent currency outflows and the accumulation of external assets. The central bank and other regulators have already issued warnings about the risks associated with cryptocurrencies, such as volatility, cyberattacks, and money laundering, and are working on a single bill that could unify the country’s approach to cryptocurrencies.

Advantages of getting a Crypto License in Argentina

Obtaining a crypto license in Argentina offers many benefits:

Stability in the use of cryptocurrencies

Cryptocurrencies are growing in popularity in Argentina due to inflation and devaluation of the local currency. Obtaining a license allows companies to offer innovative and stable financial solutions to the public looking for safe alternatives to protect their savings.

Developing a clear regulatory framework

Argentina is actively working on developing a clear regulatory framework for cryptocurrencies. Obtaining a license in this country can provide legal security and transparency for cryptocurrency operations.

Relatively fast process for obtaining a license

The implementation of a turnkey crypto license project takes 3 to 5 months.

Cryptolicense costs

There is no application fee and no annual supervision fee in Argentina.

Tax incentives

The new proposed regulatory framework in Argentina includes tax incentives, including 0% corporate income taxes, which may benefit cryptocurrency companies.

Innovation and development

Argentina has a vibrant community of startups and fintech companies. Obtaining a cryptocurrency license can facilitate collaboration with other innovative companies and contribute to the development of the fintech ecosystem in the country.

Attracting investment

A clear and favorable regulatory framework can attract foreign investment. Companies with a license in Argentina can benefit from increased interest from investors looking for opportunities in emerging markets with high growth potential.

Government support

The Argentine government has shown interest in supporting the development of the cryptocurrency and fintech sector. Obtaining a license may facilitate access to government support and funding programs, facilitating the company’s continued growth.

Compliance and security

Operating under a regulated license ensures that companies comply with local and international regulations, increasing security and reducing the risk of illegal activities such as money laundering and terrorist financing.

Access to a growing market

Argentina is one of the fastest-growing cryptocurrency markets in Latin America. With high adoption rates and growing interest in cryptocurrencies, companies can take advantage of this favorable environment to expand and attract new users.

Request more info about the Crypto License in Argentina

Requirements for getting VASP License in Argentina

To obtain a VASP license in Argentina, companies must meet the following requirements:

be a legal entity registered in Argentina;
have the appropriate organizational and management structure to carry out VASP activities;
required share capital – 2000 USD;
accounting audit – not required;
local staff – not required, but recommended;
local office – not required but recommended;
Implement an effective internal control system to prevent money laundering and terrorist financing;
have sufficient human and technical resources to carry out VASP activities;
comply with all other regulations applicable to VASP activities in Argentina.

It is important to remember that Argentine legislation is in a state of change and the requirements for obtaining a crypto license may change. Before you start the CNV registration process, it is recommended that you seek legal advice from Fast Offshore Licenses lawyers.

Regulation of VASPs in Argentina

For the past several years, the Argentine government has been working to create a unified legislative framework that will unify the approach to regulating cryptocurrencies in the country. In this regard, in early December 2022, the Argentine government passed Resolution 17/2022, which established the National Securities Commission (Comisión Nacional de Valores, CNV) to regulate cryptocurrencies within the country.

In 2023, Argentina’s national authorities initiated the drafting of a bill compliant with FATF standards. On March 14, 2024, this Bill “Prevention of Money Laundering and Terrorist Financing” was approved by the National Congress under the number 25,246.

The law introduces mandatory registration for all companies operating in the cryptocurrency sector in a specially created Registry of Virtual Asset Service Providers.

The creation of the Registry is aimed at:

regulating companies operating in Argentina that provide services related to virtual assets;
ensuring control over the companies’ compliance with the current AML/CFT legislation;
preventing the use of virtual assets for illegal purposes;
protecting the interests of investors and users of cryptocurrency-related services;
creating a transparent and accountable system in the circulation of virtual assets.

CNV Argentina warned that unregistered providers will be disqualified from operating.

Separately, individuals and entities that are not residents of Argentina are also subject to registration:

If they use domain names in the “ar” zone.
if they have commercial agreements providing for the receipt of payments from Argentine residents.

Exemptions: VASP companies whose aggregate monthly transaction volume does not exceed 35,000 UVA (units of purchasing power), which today amounts to about 27 million pesos (about US,246) are exempt from the obligation to register with the Registry.

Crypto license consultant in Argentina

Consultant

Inhyuk Suh

Phone +6531596549
Email i.suh@fastoffshorelicenses.com
Position
Associate, Consultant

Types of crypto licenses in Argentina

Argentina’s cryptocurrency regulatory system is still under development, so there is currently no clear classification of “license types” for VASPs. However, companies operating with cryptoassets are required to register with the CNV if their monthly transaction volume exceeds 27 million pesos (approximately $29,246).

Companies wishing to obtain a VASP license must apply for the CNV. The application must contain the following information:

data on the applicant company;
the organizational and management structure of the company;
the company’s internal control system;
the company’s human and technical resources;
other information deemed necessary by CNV.

The CNV has 60 days to review the application. If the application is approved, the company will receive a VASP license.

Available types of activities in Argentina after registering with CNV:

exchange between virtual assets and legal tender currencies (fiat currencies);
exchange between one or more forms of virtual assets;
transfer of virtual assets;
custody and/or management of virtual assets or instruments that authorize control over them;
participating in and providing financial services related to the offering of an issuer and/or sale of a virtual asset.

While there are no different “types” of licenses, registering a company with the VASP provides a framework for cryptoasset companies to operate safely and legally in the country.

Taxation in Argentina

Today, corporate income tax in Argentina depends on the profits earned and is:

0 to 14,301,209.21 Argentine pesos ($15,491) – 25%;
between 14,301,209.21 and 143,012,092.08 ($15,491 – $154,906) – 3,575,302.30 pesos ($3,872) + 30% on the amount exceeding 14,301,209.21 pesos;
over 143,012,092.08 Argentine pesos ($154,906) – 42,188,567.16 Argentine pesos ($45698) + 35% on the amount exceeding 143,012,092.08 Argentine pesos.

On July 8, 2024, the new Argentine government, led by President Javier Milay, published in the National Gazette the new Bill 27,742 “Law on the Foundations and Starting Points of Argentine Freedom”. This bill goes into effect on July 27, 2024, and aims to reduce the tax burden in various sectors of the country’s economy.

One of the key points of the bill is that there is no provision for the taxation of cryptocurrencies. Previously, cryptocurrency owners could declare their assets and enjoy a flat tax rate. Once the bill is passed, ownership of cryptocurrencies will not be taxed. For companies registered as VASPs, tax liability will only arise from capital gains on the sale of cryptocurrencies, and this tax will only be levied when a certain threshold is exceeded.

In addition, international transfers of cryptocurrencies will be taxed at a rate of 5% to 15%, which is aimed at attracting foreign investment in cryptocurrency. The bill also offers the possibility of declaring cryptocurrencies without the need to confirm their origin.

The law proposes to exempt from personal property tax the ownership of virtual assets held as of December 31 of each year by PSAVs registered with the CNV. This measure would be fair to other investment products and would encourage savers to consider alternatives to the dollar, contributing to the development of the crypto industry.

It is also proposed to remove any restrictions on the full exemption of collection accounts of PSAVs registered with the CNV, thereby eliminating discrimination against the crypto industry.

These changes aim to improve the tax environment for cryptocurrencies and encourage their use in Argentina.

FAQ on obtaining a VASP license in Argentina

Is cryptocurrency regulated in Argentina?

Yes, cryptocurrency is regulated in Argentina, but the regulatory structure is still evolving. It is advisable to keep up to date with regulatory changes and consult with an expert on the taxation of cryptocurrency activities.

Why is a VASP license necessary in Argentina?

As of March 2024, Argentina requires mandatory registration for cryptocurrency exchanges and other related businesses with the Registry of Virtual Asset Service Providers. This is to combat money laundering and terrorist financing. Licensing provides a legal basis for cryptocurrency businesses and is an authorization to conduct cryptocurrency activities in the jurisdiction.

What are the application steps for obtaining a VASP license in Argentina?

To obtain a VASP license in Argentina, you need to prepare documents, make sure you meet the AML and CFT requirements, submit your application to the CNV, and go through the review process. Once approved, you will receive a license that will allow you to operate legally, but it is also important to continue to comply with all regulatory requirements. It is recommended that you consult with legal professionals to ensure a successful process.

How much does it cost to obtain a Crypto License in Argentina?

There are no application fees or annual supervision fees in this jurisdiction, but the cost of obtaining a crypto license in Argentina may include legal, consulting, and compliance fees.

How long is the process to get a VASP license in Argentina?

The licensing authority can take up to 60 days to process a license application. In general, a turnkey crypto license project can take between 3 and 5 months to complete.

What are the consequences of operating without a VASP license in Argentina?

As of today, the legislation on the registration of cryptocurrency companies in the CNV has just entered into force, and operating without a virtual asset service provider license in Argentina will not be penalized shortly. However, it could lead to several serious consequences in the future, such as legal sanctions and financial penalties, operational restrictions, and reputational damage. If you need more information on how to get a VASP license, feel free to ask.

Is there an official list of licensed VASPs in Argentina?

Yes, in March 2024 Argentina created an official Registry of Virtual Asset Service Providers. This registry is maintained by the National Securities Commission and includes all VASPs that have registered by the rules. You can access the registry and find more information on the official CNV website.