The Central Bank of Cuba is also looking to license virtual asset service providers for operations related to financial, exchange and collection or payment activities.
The Caribbean nation Cuba is set recognise and regulate cryptocurrencies such as bitcoin for payments, its government said through Resolution 215 published in the official gazette on Thursday. The resolution noted that the country’s central bank will frame rules for virtual currencies. “The Central Bank of Cuba, for reasons of socioeconomic interest, may authorize the use of certain virtual assets in commercial transactions, and license virtual asset service providers for operations related to financial, exchange and collection or payment activities,” the resolution read.
It added that financial institutions and other legal entities in the country can “only use virtual assets among themselves and with natural persons, to carry out monetary-commercial operations, and exchange and redemption; as well as to satisfy pecuniary obligations, when so authorized by the Central Bank of Cuba.” According to a Reuters report, the popularity of such currencies has grown among a technologically savvy group in Cuba as it has become harder to use dollars, in part because of toughened embargo rules imposed under former President Donald Trump.
Sending and receiving money between the U.S. and Cuba became extremely difficult under the Trump administration, CNBC reported quoting Dr. Mrinalini Tankha, a professor of anthropology at Portland State University, who has been doing research on Cuba for 10 years. According to Tankha, some Cubans before the pandemic would turn to underground and somewhat semi-formalized courier services called mulas, where agencies would carry cash to Cuba and distribute it to people on the island. This path too became very difficult as the pandemic grounded flights around the world, she added.
In June this year, Central American nation El Salvador became the first country in the world to adopt Bitcoin as legal tender. In order to attract crypto entrepreneurs in the country, President Bukele had announced that there won’t be any capital gains tax on Bitcoin and that there would be immediate permanent residence offered to crypto entrepreneurs in the country.
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