The Chilean government seems to be moving in the same direction as certain countries such as China, Russia, and Kazakhstan – de facto banning the operation of crypto exchanges. According to local media, this Thursday, the three main exchanges operating in the country: OrionX, Buda (formerly known as SurBTC) and CryptoMKT received a statement in which BancoEstado (officially: State Bank of Chile) announced the closure of their checking accounts in 10 days.

This decision is critical because BancoEstado is the only public bank in the country. Previously, other banks in which the exchanges had funds – Itaú and Scotiabank, announced similar measures unilaterally. Thus, the decision of these entities (added to the fact that other banks, such as Banco de Chile, were never going to open an account for this sector), could put the South American country on a pedestal as one of the countries with the most anti-crypto policies in all of Latin America. While there is no legal position to support these actions, the bank’s stance of making cryptocurrency operations almost impossible seems to encourage that potential.

According to OrionX, they received no further explanation. Only an email from BancoEstado notifying them of the decision:

“BancoEstado adopted the decision, for now, not to operate with companies that are dedicated to the issue or creation, brokerage, intermediation or serve as a platform for calls or so-called cryptocurrencies.”

For Pablo Chávez, Buda.com’s CEO, the decision forces them to put on the table several alternatives other than asking the banks to reconsider the measure:

“We’d have to move on to some different format. The most extreme option would be to open our own digital bank, which would allow us to operate in… But another option is to involute as a model, and that would be very bad.”

OrionX was in charge of promoting calm and security in the traders who use their platform.

“[Users’ deposits] are fully backed, and there is no risk of insolvency of users.“

The Exchanges Raise Their Voices Over BancoEstado’s Decision

In light of this series of inconsistent actions, the exchanges have raised their voices in an attempt to assert their rights and promote their point of view. For Fernando Barros, lawyer and minority partner of Buda.com, the bank’s actions are unconstitutional and infringes the exchanges’ right to operate legally:

“These executives forget that the Political Constitution of Chile recognizes the right to undertake and develop any economic activity that is not prohibited. And in Chile, it is only the legislator and the regulator who can determine what Chileans cannot develop. When a group of companies does so to its potential competitors without any basis, we are faced with abuse of a dominant position and a clear anti-competitive action”.

Similarly, the exchanges issued a statement urging banks to define a clear position on cryptocurrency:

“The Bank is drowning us. We ask the Banking Association to make its position transparent and to indicate whETHer it is possible to count on the services of its members or if they are determined to prevent the existence of this industry“.