Argentina increases focus on Blockchain and Crypto Asset Regulation

DLA Piper - Over the last two months, Argentina has increasingly turned its attention to blockchain and crypto asset regulation, with advances at both the national and state levels. In this alert, we provide a brief summary of the main developments.

The Argentine government updates warrant regime to approve tokenization of goods

On July 18, 2024, the Argentine government, through Decree 640/2024 (following Decree 70/2023), approved the tokenization of goods by updating the warrant regime governed by Law 9643. This update allows for the electronic registration and blockchain-based negotiation of warrants, which are certificates representing the deposit of goods and notes securing these deposits. For example, commodities producers can now facilitate financing by selling these instruments on blockchain platforms. Key changes introduced by the decree include the authorization for the use of electronic signatures to validate warrant transactions on the blockchain, and the removal of the requirement for warehouses to be officially registered as depositors and warrant issuers. Any depositor, including producers themselves, can now custody goods and issue warrants.

Tokenizations in Argentina may be made by virtual asset services providers (VASPs) that are registered before the Argentine Securities Commission (CNV). The VASP registry is mandatory for VASPs incorporated or residing in Argentina. Foreign VASPs must also register if they have a connection with Argentina that meets specified criteria, such as conducting operations using any ".ar" domain, having commercial agreements with third parties or affiliates that allow for the local receipt of funds or assets from Argentine residents, directing advertising towards or targeting Argentine residents; or generating more than 20 percent of total turnover in Argentina from activities that require VASP registration. VASPs conducting operations in Argentina that fall below US25,000 do not require registration.

For more information, please contact Nicolas Fernandez Madero and Daiana Suk.

The City of Buenos Aires allows corporate capital contributions using cryptocurrencies

On July 15, 2024, the Superintendency of Corporations of the City of Buenos Aires (IGJ) issued Resolution 15/2024, authorizing shareholders to contribute capital to companies with virtual assets. Shareholders must demonstrate prior ownership of the assets or their acquisition for this purpose. The assets must be deposited in a platform or virtual wallet of a VASP registered with the CNV, domiciled in Argentina and compliant with national legislation, under the company’s name. Additionally, a statement from the VASP confirming the deposit of virtual assets in the company’s account and the feasibility of enforced execution must be included. As the IGJ is the most relevant authority for corporate registries in Argentina, this regulation is expected to influence similar regulations across other jurisdictions within the country.

For more information, please contact Nicolas Fernandez Madero and Daiana Suk.

The Argentine Congress approves a tax amnesty law, which includes crypto assets within the tax regularization framework

On June 27, 2024, the Argentine National Congress approved law N° 27,743 aimed at offering tax amnesty to Argentine citizens holding undeclared assets both domestically and internationally. The bill comes as part of a larger economic reform package that aims to attract investment by offering tax benefits. The regularization program covers assets such as cash, real estate, stocks, bonds, movable property, credits, rights, and also crypto assets. Furthermore, in line with its aims, the law excludes crypto assets held outside Argentina from the amnesty regime. The implementation of this law is pending regulation, with expectations that, in order to be considered "local," the custodian must be registered with the VASP registry under the supervision of the CNV, and meet the criteria outlined above to show sufficient connection to Argentina.

In addition, while most assets will be assessed at the time of regularization, the amnesty law proposes to value crypto assets based on either their acquisition date or the regularization date, whichever is higher – a method criticized for potentially disadvantaging declarants.

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