Bolivia Central Bank Updates Regulations to Include Virtual Asset Transactions

On 26 June, 2024, the Central Bank of Bolivia, Banco Central de Bolivia (BCB) issued Press Release CP35/2024, with significant updates to regulations surrounding Virtual Assets. Through Board Resolution No. 082/2024, the BCB revoked the earlier Board Resolution No. 144/2020, now permitting the use of Electronic Payment Instruments (IEP) for transactions involving Virtual Assets.

This pivotal decision, made in collaboration with the Financial System Supervision Authority, Autoridad de Supervisión del Sistema Financiero (ASFI) and the Financial Investigations Unit (UIF), aligns with the 2024 Mutual Evaluation of Bolivia by the Financial Action Task Force of Latin America, Grupo de Acción Financiera de Latinoamérica (GAFILAT). The evaluation recommended the regulation of Virtual Asset Services (PSAV) to harmonize with Bolivian public policy, prompting this regulatory evolution.

BCB’s initiative is part of an ongoing effort to modernize the national payment system, fostering technological innovation and promoting financial inclusion. Dr. Edwin Rojas Ulo, the acting President of the BCB, emphasized that Resolution No. 084/2024 will bolster financial and commercial activities, providing the population with additional transaction mechanisms.

The BCB has continuously promoted technological innovations and new payment schemes, becoming a regional reference in interconnection, interoperability, and digital financial inclusion. This new resolution will provide the population with an additional mechanism to strengthen financial and commercial activities,” he stated.

UIF Director Pamela Troche noted that the UIF will implement preventive measures to identify suspicious activities related to money laundering and terrorism financing. This regulatory adjustment aims to prevent virtual asset transactions from being exploited by criminal organizations.

ASFI will oversee financial intermediaries that offer virtual asset acquisition services, ensuring they provide necessary financial education about associated risks. Concurrently, the UIF will implement measures to prevent suspicious transactions, particularly those related to money laundering and terrorism financing, safeguarding virtual asset transactions from criminal exploitation.

The BCB reiterated that the Boliviano remains the only legal currency in Bolivia, as established by Law No. 901 of November 28, 1986. Virtual assets are not legal tender, and users assume the risks associated with their use and commercialization. To enhance public understanding, the BCB will incorporate information on virtual assets and their risks into its Economic and Financial Education Plan.

This proactive regulatory update by the BCB demonstrates a commitment to Bolivia’s economic stability and development. By enabling the use of IEP for virtual asset transactions and aligning with international recommendations, Bolivia is setting a path for a modern, inclusive financial landscape.

For more information, you can view the full press release here.