Cryptocurrencies are Illegal in Guatemala

After multiple consultations, the Superintendency of Banks announced that virtual currencies or assets such as Bitcoin, Ethereum, Ripple and other similar ones, are not legal tender in the country.

Monday, February 22, 2021

The Superintendency of Banks, derived from the different consultations made by economic and financial agents regarding the use of virtual currencies or assets, known as cryptocurrencies, informs the population that in accordance with the Monetary Law, the monetary unit of Guatemala is the Quetzal and only the Bank of Guatemala can issue banknotes and coins within the territory of the Republic, therefore virtual currencies are not legal tender in the country, explains an official statement.

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The document dated February 19, 2021, specifies that "... likewise, virtual currencies are not supported by the State of Guatemala, are not considered foreign currency, are not guaranteed, nor can they be forced to be accepted as a means of payment in transactions of goods and services."

Additionally, the transactional platforms or persons engaged in the sale and marketing of virtual currencies in Guatemala, are not under the supervision and inspection of the Superintendency of Banks, so they may not comply with security standards or risk mitigation processes, presenting possible security flaws that generate high risks for users, in addition, many of these platforms are domiciled in different international jurisdictions, so their regulation and supervision is outside the national legal system, highlights the statement.

The document concludes that "... It is worth mentioning that, as a result of speculation, people who acquire this type of virtual currency are exposed to high volatility in the price, so the value of the same could increase or decrease drastically and even reach zero. Likewise, since these transactions are anonymous, in other jurisdictions their use has been reported in different illicit operations, such as unauthorized fundraising, money laundering and financing of terrorism.

Finally, persons acquiring these types of virtual currencies or using them in commercial transactions are exposed to the different risks involved and are not covered by any type of protection.

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