Honduras Prohibits Banks from Crypto Dealings Citing Lack of Regulation

• It was accepted without a single dissenting vote and is now officially in force.
• The resolution stated that crypto might be used for fraud since they are not regulated.

A resolution prohibiting financial institutions in Honduras from dealing with cryptocurrency was issued by the National Banking and Securities Commission of Honduras (CNBS). Due to the lack of regulation, the Honduran central bank said that it is unable to guarantee cryptocurrency transactions.

Users of blockchain-based financial services and cryptocurrencies may be at risk of fraud, operational risks, and legal action, according to the resolution. People are not obligated to use or transact with them, and their acceptance could end at any moment.

Now Officially in Force

The resolution went on to say that crypto assets might be used for fraud, money laundering, or even terrorist funding since they aren’t regulated.

It is also against the rules for supervised institutions to own crypto-based derivative products. The resolution mandated that financial education programs also include the risks associated with cryptocurrency. Cryptocurrency exchanges are free to operate in Honduras.

The Honduran presidential administration includes the CNBS. On February 15, the resolution was made public, with a date of February 12. It was accepted without a single dissenting vote and is now officially in force.

When news broke in March 2022 that Honduras was considering following El Salvador’s example and legalizing Bitcoin as currency, the country’s central bank warned citizens of the dangers of investing in cryptocurrency. Concurrently, it said that it was looking into the possibility of issuing its own digital currency.

Notwithstanding, Bitcoin’s reach throughout Honduras has grown. Bitcoin Valley, located in this nation, opened to the public in the summer of 2022 with the intention of luring visitors who can spend with Bitcoin, US dollars, or the Honduran lempira.

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