UPDATED | April 26, 2018:
On Wednesday, the CEO of cryptocurrency exchange BUDA shared that the Chilean Court for the Protection of Free Competition has prohibited BancoEstado and Banco Itaú Chile from closing the accounts of cryptocurrency exchanges while a trial is still pending. CEO Guillermo Torrealba called the Court's decision a "great signal for entrepreneurship in Chile."
ETHNews previously reported on the case between the exchanges and the banks that denied them financial services.
ORIGINAL | March 30, 2018:
"We hereby inform you that BancoEstado has decided to close the account of which you are the owner, in accordance with the power provided in the Accounts Contract," the bank wrote in a notice, according to El Mercurio On-Line (Spanish).
BancoEstado said that it has decided "for now, not to operate with companies that are dedicated to the issuance or creation, brokerage, intermediation or serve as a platform for cryptocurrencies."
Earlier this week, Chilean cryptocurrency trading services BUDA and CryptoMKT, which primarily facilitate the trade of bitcoin and Ether respectively, also had their bank accounts closed, per PULSO, a Chilean business publication. Banco Itaú Chile (a subsidiary of a Brazilian bank) shut down BUDA's account, while Scotiabank Chile closed down CryptoMKT's account, according to La Segunda.
The founder of BUDA, Guillermo Torrealba, said, "They've demonized cryptocurrencies because they don't understand the technology." He added, "It's important that as a country and industry, we have guidelines to grow the cryptocurrency market in a healthy and legally compliant manner."
BUDA and CryptoMKT said that a third bank (which has not been identified) told them that it had been directed to "not open accounts for anyone who has a relationship with cryptocurrencies."
Later, BUDA and CryptoMKT published a joint letter requesting clarification from the Association of Banks and Financial Institutions of Chile (ABIF).
"The lack of knowledge and regulatory clarity has given rise to the fact that some banks, out of fear, misinformation or perhaps by strategy, are refusing to provide their services to anyone who has any relationship with any digital asset," they wrote, complaining that "in Chile the regulation is in the hands of a few, who are acting as de facto regulators and are opting to prohibit [cryptocurrencies]."
BUDA and CryptoMKT contended that they both pay value-added tax (VAT). The platforms also said that they are registered with the Chilean Financial Analysis Unit (UAF) and are compliant with the Financial Action Task Force on Money Laundering (FATF).
Thus far, ABIF has not responded to the joint letter.
Translations by author and Google Translate.