Cuba To Recognize And Regulate Bitcoin and Other Cryptos

On Thursday the Cuban government said it would “recognize and regulate” Bitcoin and other cryptocurrencies on the island.

On Thursday Cuba’s government said it would “recognize and regulate” Bitcoin and other cryptocurrencies for payments on the island, Bloomberg reported.

The local Cuban Official Gazette published a resolution which stated that the central bank will create rules for Bitcoin and other crypto to determine licensing laws for providers of crypto services on the island, Bloomberg reported.

The resolution stated the Central Bank has power to authorize the use of Bitcoin and other crypto for “reasons of socioeconomic interest”, according to Bloomberg. The resolution also said that the state will act as a check over the bank’s operations, and forbade the bank’s use of Bitcoin for “illegal activities”.

Because of tough embargo rules in Cuba it has become difficult to use dollars, and as a result the popularity of Bitcoin has grown among Cuba’s technologically savvy.

A local programmer told Bloomberg that some Cubans are already using crypto in tandem with gift cards to make online purchases.

The announcement comes just ten days before El Salvador becomes the first country to make Bitcoin legal currency as a hedge against inflation and a way to remove the high commissions and dangers of sending cash remittances, a staple of both economies.

It remains unknown how the central bank of Cuba will choose to regulate Bitcoin, as the only real controls it can put on the permissionless, immutable, unstoppable currency are through regulating exchanges and making it more difficult, though not impossible, for citizens to get access to its common on ramps and off ramps.

The official Bitcoin recognition and regulation may come in part as a result of the government’s realization that people are using the currency to evade U.S. restrictions on sending money to Cuba. 


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Mark Cuban likens shutting off crypto growth to stopping e-commerce in 1995

Leaders in the crypto industry continue to speak up as the bipartisan $1 trillion infrastructure bill, known for implementing tighter rules on crypto businesses and expanding reporting requirements for brokers, passed the United States Senate. Billionaire investor and Bitcoin (BTC) proponent Mark Cuban is one of them.

Speaking to The Washington Post over the weekend, before the bill officially passed the senate, Cuban drew a parallel between the growth of crypto to the rise of e-commerce and the internet in general:

“Shutting off this growth engine would be the equivalent of stopping e-commerce in 1995 because people were afraid of credit card fraud. Or regulating the creation of websites because some people initially thought they were complicated and didn’t understand what they would ever amount to.”

Mark Cuban is a vocal advocate for crypto and decentralized finance. The Dallas Mavericks owner is known for enabling the Mavs to accept Bitcoin, Ether (ETH) and Dogecoin (DOGE) payments for tickets and merchandise items.

He also argued in May that crypto asset prices are increasingly reflective of real utility and demand and that the day will eventually come when crypto is “mature to the point we wondered how we ever lived without.”

Related: Senators introduce pro-crypto amendment to infrastructure bill; industry says it’s not enough

On Tuesday morning, the U.S. Senate passed the controversial bill in a 69–30 vote. The bill’s main focus is roughly $1 trillion in funding for roads, bridges and major infrastructure projects.

However, the bill caused serious concerns among the crypto ecosystem as it would implement tighter rules on crypto businesses, expand reporting requirements for brokers and mandate that digital asset transactions worth more than $10,000 are reported to the Internal Revenue Service (IRS).

Senator Pat Toomey, who was among the lawmakers that have written an amendment to the infrastructure bill to exclude certain crypto companies from the reporting requirements for brokers, said the new legislation imposes “a badly flawed, and in some cases unworkable, cryptocurrency tax reporting mandate that threatens future technological innovation.”