Welcome to Latam Insights Encore. This dives deep into Latin America’s most relevant economic and crypto news last week. This edition explores how the recent cipher ban in Bolivia, related to the use of cryptocurrency for energy imports, backfires in the future.
Latam Insights Encore: Bolivia excludes codes from energy settlements
Let’s analyse the recent developments of the Bolivian government. The Bolivian government has developed a strategy that includes the largest state-owned oil companies and cryptocurrencies in the context of currency management and dollar shortages.
President Luis Arce has issued an executive order banning the state-owned oil company YPFB from engaging in cryptocurrency settlements for energy purposes as a way to curb price speculation for Stablecoin. This soothes the local markets that traders wanted to frontrun the government, but for me this is a big mistake that closes the door to what could become the biggest source of liquidity in the trade market, Stablecoins.
Stabrecoin is becoming very relevant to international reconciliation, as the White House adopts policies that promote recruitment and use under President Trump’s mission.
Even if Bolivian authorities claim that they are not handling purchases on digital assets due to a lack of counterparties, this does not mean that the market will not change in the future, and they use crypto directly to allow for this type of exchange.
Bolivia also banned the use of crypto in conjunction with the financial system in 2020, effectively shutting down local markets to innovation. Nevertheless, the Bolivian government lifted the ban, and central bank president Edwin Rojas recognized the connection as a commissioner of the Stabrecoin and the dollar.
We are confident that the ban will also be lifted over time as Stablecoins become increasingly used in international trade, including oil, gold and other goods. At least Bolivia has shown that these decisions can be reversed when needed, and recently announced that it has announced that the country’s digital currency is in the design stage for its concept.
Read more: Bolivia, dollar-bound, relying on cryptocurrency for energy imports
Read more: Since Bolivia Bans State Oil Company used codes for energy settlements
