CMC News

#Bolivia Plans #Crypto Integration Into Financial System

Bolivia is set to integrate cryptocurrencies and stablecoins into its financial system as the government seeks to modernize the country's economy. Economic Minister Jose Gabriel Espinoza announced the plan on Tuesday.

Banks will be allowed to custody crypto on behalf of clients. Digital currencies will function as legal tender for savings accounts, credit products, and loans, Reuters reported. Espinoza said, “You can’t control crypto globally, so you have to recognize it and use it to your advantage.”

Bolivia suffers from high fiat currency inflation, prompting residents to turn to stablecoins as a store of value and medium of exchange. The boliviano averaged above 22% #inflation in the 12 months to October, according to Bolivia's National Institute of Statistics.

Businesses in the country have started denominating prices in $USDT, a dollar-pegged stablecoin, as an alternative to the local currency. YPFB, Bolivia's state-owned energy company, announced in March it is building a framework to pay for energy imports in crypto.