Honduras watchdog bans institutions from trading crypto

Honduras watchdog bans institutions from trading crypto output 

TEGUCIGALPA: Citing dangers of fraud and money laundering, the Honduran CNBS regulator declared in a resolution that it would not let the country's financial system to trade cryptocurrencies or other virtual assets.output

A resolution that was released on Friday, while it was dated from Monday, according to the National Banking and Securities Commission, had "immediate effect."

"Maintain, invest, intermediate or trade in cyptocurrencies, crypto-assets, virtual currencies, tokens, or any similar virtual assets not issued or authorized by the central bank" is prohibited by the resolution for institutions falling within its purview.

Although cryptocurrency trading platforms are active in Honduras, the country's laws do not yet govern them.

Many of these platforms are domiciled in multiple jurisdictions, making Honduran law unable to regulate them. Additionally, the watchdog stated that these platforms face the risk of "lending themselves to activities of fraud, money laundering and terrorist financing."

The central bank of Honduras has issued a warning, stating that it cannot and is not liable for any such transaction.

In March 2022, the central bank declared that it was researching the feasibility, both technically and legally, of creating its own digital money that would be subject to regulation and accepted as legal tender. It hasn't made an announcement regarding this yet.

As of April 2022, Honduras Prospera, a so-called model resort town in the Caribbean that functions as a zone of administrative, fiscal, and budgetary autonomy (ZEDE), declared that bitcoin would be accepted as legal cash inside its boundaries.

It was unclear at first how the new policy would impact it.