Bolivia Advances Crypto Momentum as Bank Launches USDt Custody Service

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In a significant move signaling the country’s evolving stance on digital assets, Bolivia is gaining momentum in cryptocurrency adoption. Banco Bisa, one of the nation’s leading financial institutions, has launched a custody service for Tether’s USDt stablecoin, marking a pivotal shift in how digital currencies are perceived and used within the South American economy.

This development reflects Bolivia’s broader transformation—from a nation that once strictly banned cryptocurrencies to one now embracing blockchain-based financial services under regulated conditions.

A Regulatory Shift Toward Digital Finance

Back in 2014, the Bolivian government enforced a strict prohibition on cryptocurrencies, declaring that any currency not issued or regulated by the Central Bank of Bolivia was illegal. At the time, the use of Bitcoin (BTC) and other decentralized digital currencies was explicitly outlawed, with authorities citing risks to national monetary stability and consumer protection as primary concerns.

However, by mid-2024, Bolivia began reversing this long-standing policy. On June 28, 2024, the country lifted its ban on Bitcoin and cryptocurrency payments, allowing financial institutions to legally engage in digital asset transactions. This regulatory shift was driven by the Central Bank's goal to modernize the financial system, align with regional trends in Latin America, and foster greater economic inclusion through innovative financial tools.

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Banco Bisa Leads with USDt Custody Service

At the forefront of this transformation is Banco Bisa, which recently introduced a regulated custody solution for USDt (Tether)—one of the most widely used stablecoins globally. The service enables users to securely hold, buy, sell, and transfer USDt, facilitating both domestic and cross-border transactions with ease.

According to Franco Ugeda, Commercial Vice President at Banco Bisa, customers must undergo a verification process before accessing the service. This Know Your Customer (KYC) protocol ensures compliance with national regulations and enhances transaction security—an essential step in building trust in digital finance.

Yvette Espinoza of Bolivia’s financial oversight authority, Autoridad de Supervisión del Sistema Financiero (ASFI), endorsed the initiative, emphasizing that it allows citizens to participate in crypto markets within a secure, government-supervised framework. She noted that such regulated services significantly reduce the risks associated with unsecured or illicit crypto trading.

Why USDt? Stability Meets Accessibility

The choice of USDt as the inaugural digital asset for custody services is strategic. As a dollar-pegged stablecoin, USDt offers price stability compared to volatile cryptocurrencies like Bitcoin or Ethereum, making it ideal for everyday transactions, remittances, and value preservation.

For Bolivians—especially those receiving international remittances—USDt presents a faster, more cost-effective alternative to traditional banking channels. With average monthly crypto transaction volumes reaching $15.6 million between July and September 2024, according to the Central Bank, demand for efficient digital payment solutions is clearly on the rise.

Surging Adoption After Regulatory Reforms

Since the lifting of the crypto ban, virtual asset activity in Bolivia has surged dramatically. The Central Bank reported a 100% increase in virtual asset transactions in the third quarter of 2024 alone. This growth underscores a growing public appetite for digital financial tools and suggests strong potential for further integration of blockchain technology into mainstream banking.

While Banco Bisa currently focuses on USDt, industry experts anticipate that additional stablecoins and even self-custody wallet integrations could follow as infrastructure matures.

Bridging Traditional Banking and Digital Assets

Banco Bisa’s initiative exemplifies a growing trend across Latin America: traditional banks integrating blockchain-based services to meet evolving customer demands. By offering regulated access to stablecoins, banks can provide:

These benefits are particularly relevant in economies like Bolivia’s, where inflation and currency volatility have historically challenged financial stability.

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No Tax Framework Yet—but Regulation Is Evolving

Despite these advancements, Bolivia has yet to establish a formal tax framework for cryptocurrency transactions. While the absence of clear tax guidelines may raise questions about long-term compliance, it also reflects the early stage of regulatory development in this space.

That said, ASFI’s active involvement in overseeing crypto-related banking services indicates a cautious but progressive approach. Future regulations may include reporting requirements, capital gains taxation, or anti-money laundering (AML) protocols tailored to digital assets.

Frequently Asked Questions (FAQ)

Q: Is cryptocurrency legal in Bolivia now?
A: Yes. As of June 28, 2024, Bolivia lifted its ban on Bitcoin and other cryptocurrencies, allowing financial institutions to offer crypto-related services under regulatory supervision.

Q: Can I buy Bitcoin at Banco Bisa?
A: Currently, Banco Bisa offers custody and transaction services for USDt (Tether) only. There is no public information indicating that Bitcoin or other cryptocurrencies are available for purchase through the bank at this time.

Q: Is USDt the same as USD?
A: USDt is a stablecoin pegged 1:1 to the US Dollar and backed by reserves. While not legal tender, it aims to maintain parity with the USD and is widely used in digital transactions globally.

Q: Are crypto transactions taxable in Bolivia?
A: As of now, Bolivia does not have an official tax framework specifically for cryptocurrency gains or transactions. However, this may change as adoption grows and regulatory oversight expands.

Q: How do I start using USDt through Banco Bisa?
A: Customers must complete a verification process (KYC) with Banco Bisa to access the USDt custody service. Once approved, they can buy, sell, send, and receive USDt via the bank’s platform.

Q: Why is Bolivia adopting crypto now after banning it?
A: Economic modernization, regional alignment with Latin American crypto policies, and increasing demand for efficient digital payment systems have driven Bolivia’s shift from prohibition to regulated adoption.

The Road Ahead: Building a Digital Financial Ecosystem

Bolivia’s journey from crypto prohibition to regulated innovation highlights a broader global trend—governments recognizing the value of blockchain technology when implemented responsibly. With Banco Bisa leading the charge, the country is laying the groundwork for a more inclusive, efficient, and digitally enabled financial ecosystem.

As adoption continues to grow and regulatory clarity improves, Bolivia could emerge as a model for how emerging economies can integrate digital assets without compromising financial stability.

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Core Keywords:

This strategic integration of blockchain into traditional banking not only empowers consumers but also positions Bolivia as a forward-thinking player in the future of money.