Guatemala Concerned About Digital Currencies’ Money Laundering Risks
Warning Issued by Superintendency of Banks
The Superintendency of Banks in Guatemala has issued a statement warning citizens about the risks associated with using digital currencies, also known as cryptocurrencies.
Official Currency and Regulation
According to the Monetary Law, the Quetzal is the official currency of Guatemala and only the Bank of Guatemala can issue banknotes and coins within the country’s territory. Virtual currencies are not legal tender in Guatemala and are not supported by the state.
Risks and Vulnerabilities
The statement highlights that these platforms are often domiciled in different international jurisdictions, making it difficult for Guatemalan authorities to regulate and supervise them. As a result, users are exposed to high risks, including:
- Possible security flaws
- Anonymity, which has led to reports of virtual currencies being used in illicit operations such as money laundering and financing of terrorism
Volatility and Lack of Protection
The value of digital currencies is highly volatile and can increase or decrease drastically, potentially reaching zero. Additionally, individuals acquiring these currencies are not covered by any type of protection.
Expert Warning
Experts say that the use of digital currencies without proper regulation poses significant risks to financial stability and could lead to a lack of confidence in the country’s financial system.
Urgent Advice from the Superintendency of Banks
The Superintendency of Banks is urging citizens to exercise caution when dealing with virtual currencies and to report any suspicious transactions or activities. Users are advised to be aware of the risks involved and to take necessary precautions to protect themselves.
Key Takeaways
- Virtual currencies are not legal tender in Guatemala
- Transactions involving virtual currencies are not supervised by the Superintendency of Banks
- The value of digital currencies is highly volatile
- Individuals acquiring these currencies are not covered by any type of protection
- The use of digital currencies without proper regulation poses significant risks to financial stability