Argentina and Cryptocurrency Deregulation: Challenges and Opportunities

Progress and Expectations in Crypto Deregulation

At the LABITCOINF conference in Buenos Aires, Alejandro Rothamel, legal director at the Ripio cryptocurrency exchange, shared his thoughts on the current state of crypto deregulation. Rothamel expressed cautious optimism about the government’s direction but noted a lack of tangible progress specific to the industry.

“There hasn’t been much deregulation for cryptocurrencies yet. While general deregulation is a focus, there are still many broader regulations that restrict the crypto sector and the types of businesses it can engage in,” Rothamel explained. He emphasized the need for targeted deregulation to foster growth and innovation in the crypto industry.

Uruguay: A Model for Gradual Crypto Regulation

When asked about countries with successful crypto regulations, Rothamel pointed to Uruguay as an example. In Uruguay, the regulatory framework was carefully designed by the Central Bank with a precise and measured approach. “They didn’t aim for a sweeping, all-encompassing law like MICA in Europe. Instead, they addressed specific areas surgically,” Rothamel remarked.

He highlighted the importance of gradual regulation, warning that overregulation could stifle innovation, discourage users, and create barriers to entry. “Cryptocurrencies aim to democratize access to finance, enabling individuals to control their own value. Regulation should reflect that principle,” he added.

Early Steps Toward Regulation in Argentina

Despite the slow progress, Rothamel acknowledged some positive developments in Argentina. The National Securities Commission (CNV) recently established a registry for virtual asset service providers (PSAV), marking an initial step toward regulating intermediaries in the crypto ecosystem.

According to Rothamel, these efforts pave the way for further advancements, such as enabling new financial services like crypto-based loans and expanding the capital market through cryptocurrency instruments. He remains hopeful that future reforms will “uncorset” the industry and unlock its potential for innovation.

Bitcoin and the Role of the State

The broader debate about Bitcoin’s relationship with the State remains a contentious issue. Bitcoin was originally envisioned as a means to separate money from government control, and some see regulation as fundamentally at odds with this philosophy.

Rothamel offered a nuanced perspective, suggesting that Bitcoin and the State are not inherently antagonistic. “Bitcoin gives users the freedom to choose. You can hold your Bitcoin on an exchange like Ripio or opt for self-custody with cold storage. It’s about how deeply you want to engage with the technology and your preferences for privacy and financial freedom,” he said.

However, he acknowledged that die-hard Bitcoin enthusiasts might disagree with this pragmatic view. “For long-time Bitcoiners, the belief that the State must disappear and Bitcoin is the only true currency may remain unshaken,” Rothamel conceded.

A Long Road Ahead

While the Argentine government’s focus on deregulation shows promise, the cryptocurrency sector has yet to benefit significantly from these reforms. The experience of countries like Uruguay demonstrates the potential of thoughtful, gradual regulation to support industry growth without overreach.

In Argentina, the steps taken so far, such as the PSAV registry, suggest that the groundwork is being laid. However, greater efforts are needed to address the broader regulatory challenges and unlock the full potential of cryptocurrencies in the country. Whether through targeted deregulation or innovative regulatory frameworks, the future of crypto in Argentina will depend on balancing freedom, security, and accessibility.