- BiG suspends fiat transactions to crypto exchanges, casting doubt on the industry’s future in Portugal.
- Some of the other Portuguese banks such as Caixa Geral, however, still accept fiat transactions linked to cryptocurrencies, hence no ban in the country.
- The move by BiG is in tandem with the EU’s MiCA regulations, changing the dynamics of how banks engage with digital assets in the region.
Investimentos Globais (BiG), a Portuguese bank, has suspended fiat transactions to cryptocurrency exchanges. It has also created doubts on the effects of the decision on the country as one of the most welcoming nations for cryptocurrencies.
In a recent X post, Jose Maria Macedo, a co-founder of Delphi Labs, pointed to the constraint, arguing that it could push consumers towards blockchain-based systems. Nevertheless, BiG has not elaborated on the rationale for its decision.
Portugal’s Crypto-Friendly Banks
However, some other banks in the country, including Caixa Geral de Depósitos has not completely banned fiat transactions to cryptocurrency platforms. This indicates that the restriction is not mechant over the whole country.
The cultural attitude towards cryptos is relatively positive in Portugal, the country has been quite friendly towards crypto. This was the case in 2019 when the authority in Portugal, the Portuguese Tax & Customs Authority, made a decision to remove value-added and capital gains taxes from cryptocurrency transactions.
However, a new tax policy enacted in 2023 charged a 28% capital gains tax to short term cryptocurrencies investments. This scheme applies a tax exemption on long-term holdings to a great extent.
The decision by BiG comes at a time when there has been increased focus on cryptocurrencies within the European region. The European Union’s MiCA, Markets in Crypto-Assets Regulation is in the process of creating a unified approach to the regulation of digital assets. According to the changes that have been made, it will alters the way banks can engage cryptocurrency platforms in the region.
Challenges in Digital Assets Adoption
Around the world, states are fine-tuning their approaches to cryptocurrencies based on the current state of the market. In September 2021 El Salvador became the first country in the world to adopt Bitcoin as an official currency. Lately, El Salvador has reduced its Bitcoin adoption to get a $1.4 billion loan from the International Monetary Fund (IMF). The agreement eliminates the demand for businesses to accept Bitcoin and cuts down the government’s Bitcoin buying.
These changes show the developing interaction between conventional monetary frameworks and advanced resources. Banks, governments and regulatory authorities are changing the way they approach cryptocurrencies. The action of BiG shows the problem with digital asset inclusion in the world financial system and the unknowns that come with it.
However, BiG has put a ban on the Fiat transactions, other banks next to Portugal still carry out the cryptocurrency transactions. Such differences illustrate the different strategies that financial institutions are employing as they move through the challenging and constantly evolving crypto landscape.
