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Reserve freezes deposits and withdrawals in 6 Latin American countries

Reserve freezes deposits and withdrawals in 6 Latin American countries

Reserve Digital Wallet announced on July 3 that deposit and withdrawal services with fiat currencies will be suspended for at least six Latin American countries starting next month. The decision has been taken due to issues with the banking partners they work with.

So this is it Indian Gabriel Jiménez, CEO of RPay, Reserve’s instant payment service. In a press release, the administrator pointed out that they are national currencies that will stop loading and withdrawing on the platform Argentine Pesos, Colombian Pesos, Peruvian Soles, Venezuelan Bolivares and US Dollars.

In this respect, the move will affect six Latin American countries. These are Argentina, Venezuela, Colombia, Peru, Ecuador and Panama.

Deposit and withdrawal services can be used in these countries till August 3. ie users They have exactly one month to take action related to national currenciesBecause after time, it becomes impossible.

In this sense, after the date the reserve platform can only operate with Mexican pesos.

According to RPay’s CEO, the reasons for the discontinuation of the deposit and withdrawal service are in response to “sustainability issues related to the banking challenges of working with companies that process cryptocurrencies.” It means they have Problems with bank partnersBecause they are both Bitcoin (BTC) and cryptocurrency wallets.

As Jimenez put it, “banks tend to disengage from cryptocurrency clients due to concerns about regulatory scrutiny.” All this worsened after the crisis created by FTX, one of the largest exchanges in the market, which collapsed in November 2022.

Along those lines of thought, starting next month, Reserve These six countries only allow fixed cryptocurrency deposits and withdrawals, such as USD Coin (USDC), Tether (USDT), DAI (DAI) and eUSD. Services will also be enabled for Bitcoin and Ether (ETH), the cryptocurrency of the Ethereum network.

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Suspension of services, according to Jimenez This is an “indefinite suspension” and not a termination Activities.

“Indefinite Interval”

“We have not given up, but at the same time, we do not have a date for the reactivation of payments and withdrawals in local currency in Venezuela, Argentina, Colombia, Peru, Ecuador and Panama,” the manager admitted.

Jimenez pointed out that the reserve team It is already making progress on “multiple fronts”. “To coordinate our global strategy”. He also admitted that they have been “trying to avoid this situation” for a year.

“We will continue to fight to restore and improve our services in Latin America. But today, our best option is to go back, rebuild and come back stronger with new alliances and solid foundations,” Jiménez argued.

Looking for a partner to operate in Venezuela

Gabriel Jimenez also revealed that they only need one banking partner to work with them to resume their services in Venezuela. The above is because they have obtained a license from the United States Department of the Treasury’s Office of Foreign Assets Control (OFAC) that allows them to maintain their operations in the Caribbean country.

As you said, that license allows you to reserve They offer a “more reliable and stable” service to the people of Venezuela. “Therefore, our main objective now in Venezuela is to integrate our renewed global strategy and establish a relationship with a direct banking partner. Without this, we will not provide liquidity in bolivars,” he said.

Due to the current sanctions imposed on Venezuela, Jimenez recalled. There are problems with the provision of financial services in that country. Many financial services companies, both connected and unrelated to cryptocurrencies, have stopped operating in the country. Among them, UpHold, Skrill, Paxful and the defunct Bittrex exchange.

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“The existence of such a license does not absolve Rpay from its compliance obligations, but it significantly reduces the risks of non-compliance, allowing Rpay to confidently continue its operations in the country,” Jimenez stressed.

If it’s not your keys, it’s not your bitcoins

Due to problems with centralization and the fiat system, Reserve is now unable to continue serving Venezuelan, Panamanian, Argentine, Colombian, Peruvian and Ecuadorian clients. Bitcoin is a good time to remember and its foundations.

Bitcoin, being digital money, can be transferred and sent to anyone. It can also be converted into fiat money if needed. That’s the difference This technology does not require authorization to operate.

This happens in a fiat system. Instruments such as reserves, which accommodate money created by central banks, Comply with obligations and regulations of the countries in which they operate. Otherwise, they are subject to the restrictions of the rulers.

This cannot be found in Bitcoin. With the first cryptocurrency you can transact peer-to-peer, make transfers or save, Can be controlled without a trusted third party or authority A specific service.