Cryptocurrency has scored a second win in an apparent battle between Chile’s banks and the top crypto exchanges which has seen financial institutions shutting down accounts belonging to the top platforms during past few months.
Orionx came out tops when Santiago’s Fourth Chamber of the Court of Appeals recently ruled in their favour. Banco Estado was instructed to re-open their account on the grounds that the bank’s action was illegal, according to a CNN report.
Several Platforms Hit By Shutdowns
The clash between Orionx and Banco Estado was the latest in a string of similar account-shutdowns which involved Banco Estada as well as other Chilean banks like the Bank of Nova Scotia and Itau Corpbanca. Targeted alongside Orionx were Crypto MKT and Buda, giving rise to fears that the country’s banking institutions were set to take on the cryptocurrency platforms in what looked like a calculated attack on the digital currency industry.
It immediately emerged that the fear was justified. At the time, Banco Estado stated openly that it had decided not to operate with companies that were creating, issuing, brokering or intermediating “so-called cryptocurrencies”, or which served as a platform for them. In response, exchanges took their cases to an appeals court that was prepared to hear their side of the story.
Orionx won its case based on a constitutional right to equality before the law, which the court determined was not upheld by Banco Estado when it closed the account in accordance with a policy it had not yet agreed to when the contract was concluded. The shutdown was labelled an “arbitrary and illegal action”. The court went further, in stating that closing the account impacted on an economic activity that was not against the law.
Second Win In Fight against Account Closures
Orionx’s legal win is the second triumph for cryptocurrency in Chile, following another court decision in April to order Itau Corpbanca as well as Banco Estado to re-activate the Buda accounts it had shut down. That time, the decision came from Chile’s anti-monopoly court. When the banks closed Buda’s accounts, the exchange was enjoying over $1 million per day in trading volumes.
Although the crypto sector has won two rounds in the battle, it remains to be seen whether these victories will be enough to win the war. The president of the country’s central bank, Mario Marcel, has been reported to be considering introducing cryptocurrency regulations, which would provide financial institutions with information to “monitor associated risks.”