After warning about the risks of cryptocurrencies on the financial system after its collapse in 2021, Argentina has authorized the use of financial instruments linked to cryptocurrencies for the first time. It comes again futures contracts on bitcoin (BTC). to attract investments in pesos and regulated by local legislation.
The National Securities Commission (CNV) has authorized the regulation of such futures contracts on the Matba Rofex Bitcoin Index, with trading and settlement in Argentine pesos and without delivery of the underlying. The index created in 2021 replicates the average price of Bitcoin in pesos based on data from the twelve largest market participants.
“The formation of said index will be carried out starting from information on the price of Bitcoin provided by different price providers, entities that facilitate the functioning of the BTC/ARS pair, with a deposit of Argentine pesos. by Bank transfer“, explained the CNV in a statement.
Matba Rofex is the main place where futures contracts are traded, especially dollar futures. A futures transaction is a peso contract in which two parties fix the value of an asset at a future date. When that date arrives, the seller or buyer can make a profit or loss, depending on whether the official price of the currency is higher or lower than the contract price.
In this case, the new contract will have the main digital currency as its underlying asset, such as it broke the US$30,000 barrier this Monday. The goal is “to adapt to the regulatory challenges posed by new technologies for the provision of financial products, as well as to encourage the development of new and innovative products by its regulated entities in the capital market,” the agency said.
“It is not a new regulation, the regulation for the authorization of futures contracts has not been modified and has general scope, the CNV has the power to authorize these contracts like any other capital market instrument and the particularity of this authorization is that what will follow this contract is the Matba Rofex Bitcoin index,” they explained to CNV.
The agency has indicated that while it has no jurisdiction or exercise any oversight or control over these suppliers, it requires Matba Rofex to establish as a condition of eligibility that they have an ongoing contract with a Payment Service Provider (PSP), registered with the Central Bank for the provision and use of its payment services in the country.
“In this way, qualified investors will be able to gain exposure to Bitcoin price changes in a secure and transparent way derivative products traded in regulated market infrastructures“Authorities said in their statement.
It has generated mixed reactions on the market. On the one hand, some traders have interpreted it as a possible and dangerous way to channel the “CCL future dollar” because an asset that is bought and sold in dollars is exchanged for pesos in the future. For others, however, it will allow them to invest in pesos according to local regulations.
“They are peso futures in a regulated market intended for qualified investors, they allow exposure to BTC without the need to change currencies or jurisdictions and without the practical complications of holding btc, so you can invest in btc but in a regulated way environment,” explained Javier Marcus, Business Manager at Southern Trust.
The new contracts would be aimed at companies, who today find it difficult to use cryptocurrencies as a means to become dollarized. “It certainly won’t be attractive to individuals who already buy bitcoin freely but it opens up an opportunity for those who haven’t dared yet or don’t have easy access like many companies do,” added Marcus.
At the request of the CNV, Matba Rofex must incorporate “warnings” aimed at the investing public warning of the risks associated with this operation and of the possible contingencies in the formation of the instrument. From the BCRA, meanwhile, they said they were not involved in the resolution.
Both the CNV and the BCRA have warned in recent years about the risks of cryptocurrencies due to their high volatility and lack of deposit insurance or regulatory protections, incomplete information in price formation and money laundering risk. Nor do they consider them legal tender.
Source: Clarin
