- Executive Order 5399 prohibits YPFB, the state-owned oil company of Bolivia, from buying crypto to settle payments.
- The President of YPFB mentioned that the firm had not used crypto for transactions.
The President of Bolivia, Luis Arce, has signed an executive order that mentions a ban on the use of crypto assets for energy purchases. This step has been taken to restrict assumptions revolving around cryptocurrencies and stablecoins on exchanges such as Binance.
Bolivia has so far been active and has shown positive signs of integrating crypto into its payments and financial systems. But now it has banned the use of crypto for resolving energy-associated purchases.
This step is also one of the economic actions taken to restrict assumptions on crypto exchanges such as Binance. Executive Order 5399 prohibits YPFB, the state-owned oil company, from buying crypto to settle payments.
It was approved on May 23 after the surge of the price of stablecoins in parallel markets, as traders attempted to pioneer the firm in a for-profit dollar trade. The President mentions that YPFB hasn’t initiated any transactions using cryptoassets.
The Primary Reasons For Not Using Crypto
However, there have been significant assumptions revolving around this issue that impact expectations concerning the exchange rate, and this step avoids that prejudice. The President of YPFB, Armin Dorgathen, mentioned that the firm had not used crypto for transactions for two primary reasons.
The first one is no counterparty acceptance for these assets in the oil industry, and the second one is the lack of clear regulations to fulfill these exchanges. He further added that YPFB, today, is not leveraging crypto assets.
Also, it is not something they are thinking of doing in the short term; many companies still do not acknowledge it as a form of payment, so it is improbable that we will be able to use it as a form of payment for fuel.
Concluding this, he also mentioned that the volumes negotiated in national exchanges were very low and illiquid to fund the required fuel purchases. In March, a prominent news outlet, Reuters, reported that YPFB was ready to use crypto to resolve energy payments due to a lack of foreign currency.
The news was further confirmed by local government sources. However, this step avoids any possibility of this event at least in the short term.
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