FINANCIAL SERVICES ADVISOR a PUBLICATION of the DIALOGUE July 1-14, 2021

LATIN AMERICA ADVISOR FINANCIAL SERVICES ADVISOR A PUBLICATION OF THE DIALOGUE www.thedialogue.org July 1-14, 2021

BOARD OF ADVISORS FEATURED Q&A TOP NEWS Ernesto Armenteros Vice Chairman of the Board, REMITTANCES Banco de Ahorro y Crédito Unión Should Mexican Remittances to Pablo Barahona President & COO, Mexico Hit Record Global Retail Markets West, Liberty Mutual Group Banks Avoid Use of $4.5 Billion in May Felipe Carvallo The amount of money Mexicans Vice President - Analyst abroad sent back home hit $4.5 Latin America Banking Cryptocurrencies? Moody’s Investors Service billion in May, a record level, the country’s central bank said. Richard Child Page 2 CEO, Mattrix Group Michael Diaz Jr. DIGITAL CURRENCIES Partner, Diaz, Reus & Targ SoftBank Invests Ernesto Fernández Holmann $200 Million in Chairman of the Board, Ayucus Mercado Bitcoin Rich Fogarty Japan’s SoftBank Group has Managing Director, invested $200 million in Mercado Alvarez and Marsal Bitcoin, which is among Latin Desiree Green Comments from Mexican billionaire Ricardo Salinas Pliego that his Banco Azteca could start America’s largest cryptocur- Vice President, using Bitcoin led Mexican financial authorities to warn against the practice. // File Photo: rency exchanges, the executive International Government Affairs, Facebook Page of Ricardo Salinas Pliego. chairman of the platform’s parent Prudential Financial company announced. Mexico’s central bank, finance ministry and financial sector Laura Güemes Cambras Page 4 Transactions Attorney, regulator on June 28 warned that cryptocurrency assets are Holland & Knight not legal tender in Mexico and said financial institutions op- Earl Jarrett BANKING Chief Executive Officer, Q erating with them could face sanctions. The joint statement Citigroup Sells The Jamaica National Group followed remarks by billionaire Ricardo Salinas Pliego, who said his con- Thomas Morante glomerate’s financial unit, Banco Azteca, could start using Bitcoin. What Operations Attorney Carlton Fields incentive do banks have to start using cryptocurrencies? How justified is in Venezuela Manuel Orozco the warning from the country’s top financial officials, and what risks and Citigroup, which has operated Senior Fellow, in Venezuela for more than a opportunities do digital currencies pose to Mexico’s traditional banks? Inter-American Dialogue century, announced that it has Adalberto Palma-Gomez How would a wider use of cryptocurrencies in commercial transactions sold its operations there to Banco Senior Partner, change Mexico’s economy? Nacional de Crédito. Citi’s CEO Proxy, Gobernanza Corporativa for Latin America, Ernesto Torres Rodolfo Pittaluga Cantú, said the bank will “maintain Adjunct Professor, Tapen Sinha, professor of risk management at the Instituto a strong presence” in the region. Florida International University Page 2 College of Law Tecnológico Autónomo de México and professor at the Fabian Saide University of Nottingham Business School: “In the United Founder, CEO and President, States, there is movement among some banks toward the Paykii A use of Bitcoin and other cryptocurrencies. However, the Bank of Interna- Roberto Teixeira da Costa Founder & Board Member Emeritus tional Settlements (BIS) declared that ‘it is clear that cryptocurrencies CEBRI are speculative assets rather than money.’ Curiously, the current general Mario Trujillo CEO, manager of the BIS happens to be Agustín Carstens, the former president DolEx Dollar Express of the Bank of Mexico. The BIS noted that cryptocurrencies are often used to facilitate money laundering, ransomware attacks and other financial crimes. In particular, Bitcoin has the dubious distinction of using energy wastefully. All of these bad features are relevant for Mexico. Bitcoin will make laundering of drug money more difficult to catch for the fiscal authorities in Mexico. Banco Azteca is a big player in remittances to Torres Cantú // File Photo: Citigroup. Continued on page 3

BANKING NEWS said the operations of Banco Azteca in Peru NEWS BRIEFS represented “a nonmaterial proportion in rela- Citi Sells Operations tion to all of Grupo Elektra’s financial business BBVA Rolling Out activities.” Elekra added that it would focus its Biometric Cards in Mexico in Venezuela to Banco efforts on the United States, Mexico and Cen- tral America, Milenio reported. in June 2019, The Mexico unit of Spanish bank BBVA is roll- Nacional de Crédito Elektra announced it had sold oll of its shares ing out new biometric payment cards as a test in the El Salvador operations of Banco Azteca. run for a global introduction of the new cards, Citigroup announced July 12 that it has agreed American Banker reported July 12. The bank is to sell its operations in Venezuela to Cara- adding biometrics to cards in Mexico, removing cas-based Banco Nacional de Crédito. The REMITTANCES NEWS account details printed on the cards and using sale has received regulatory approval and is recycled materials for 86 percent of the cards’ expected to close in coming weeks, Citi said composition. BBVA chose Mexico for testing in a statement. “Citi is committed to Latin Mexico’s Remittances the new cards because of the degree of pay- America and will maintain a strong presence in Hit Record Level, ment fraud in the country as well as Mexicans’ the region where we have operated for over a heavy reliance on cash. century and built an unmatched network,” Citi $4.5 Billion in May Latin America’s chief executive officer, Ernesto Torres Cantú, said in the statement. “We would The amount of money that Mexicans abroad Chile Reaches Deal like to thank our colleagues in Venezuela for sent back home topped $4.5 billion in May, a for Bond Listings on their dedication and exceptional performance, record monthly level, the country’s central bank as well as our clients for their partnership over announced July 1. In March of last year, remit- Euroclear Platform the years.” Citigroup has operated in Venezuela tances to Mexico surpassed $4 billion for the Chile has reached a long-awaited deal with for more than a century, the New York-based first time, and now Mexicans abroad regularly Europe’s largest securities settlement house, financial services company said. Jorge Nogu- send more than that amount back home, the Euroclear, to include the Andean nation’s eroles, the CEO of Banco Nacional de Crédito, wire service reported. The record level in May corporate bonds on the firm’s international in- or BNC, said the Venezuelan bank’s growth will followed records in March and April. May is vestor platform, Reuters reported July 2, citing benefit clients who had accounts with Citi in traditionally a strong month for remittances to Andrés Pérez, the Chilean finance ministry’s Venezuela. “BNC is committed to supporting Mexico because of Mother’s Day. So far this coordinator for international finance. Although Citi’s clients in Venezuela who will continue year, the amount of money transfers sent to Chile’s government bonds had earned so-called receiving high-quality financial services while Mexico fell below $4 billion only in January and “Euroclearability” in 2017, its addition to the benefiting from the advantages of an expand- February, which are traditionally slow months $20 billion-$25 billion domestic corporate bond ing local bank with a skilled professional team for remittances. For the first five months of this market had lagged due to government changes and a modern technological platform,” he said. year, Mexico’s remittances amounted to $19.2 and technical issues including tax treatment, billion, a 21.7 percent increase as compared to according to the report. the same period last year. If the current trend Banco Azteca, continues, Mexico could take in some $45 Elektra Close All billion in remittances this year. Only manu- facturing exports bring Mexico more foreign Brazilian Court Approves Branches in Peru income than do remittances, which surpass the Oi’s Sale of Fiber Optic country’s income from oil exports and tourism. Business to BTG Funds Banco Azteca and Grupo Elektra, both of which Mexico’s level of remittances also has set Brazilian telecommunication company Oi said are owned by Mexico’s Grupo Salinas, have records for five consecutive years, the AP re- on July 7 that a court had approved its sale of closed all of their branches in Peru, Milenio ported. The $40.6 billion that Mexicans abroad a majority stake in its fiber optic business to reported July 11. The closure of the branches sent back home last year roughly equaled the funds managed by Banco BTG Pactual, Reuters came more than seven months after Elektra, budgets of the Mexican government’s minis- reported. Oi filed for bankruptcy protection a Grupo Salinas unit that owns Banco Azteca, tries of education, health, labor, welfare and in 2016 and has been selling assets to repay said it had sold its operations in Peru to a culture combined. Approximately 98.5 percent creditors. In April, Oi agreed to a $2.5 billion group of investors “with recognized experience of Mexico’s remittances come from the United offer for a 57.9 stake in its fiber optic business and trajectory in the financial sector.” At the States, nearly all via bank transfers or wire from BTG’s funds, but other firms still had time time of the announcement on Nov. 26, Elektra transfers. Cash accounts for only about 0.7 to submit competing bids.

percent of the country’s remittances, the wire FEATURED Q&A / Continued from page 1 service reported. Factors including a “competitive” dollar/peso exchange rate as well as a Mexico (along with other Central American groundbreaking innovation that is currently “deep contraction of activity and employment countries). Mr. Salinas Pliego believes that operating on a parallel universe. Banks in Mexico” have helped to fuel remittances through Bitcoin use, it can hold onto its mar- have the opportunity to bring to bear their from the United States to Mexico, Alberto ket share in that space, if not increase it. The risk management expertise and actually Ramos, managing director and head of Latin main customer base for Grupo Elektra (the facilitate a safer transition into a regulated America economics at Goldman Sachs, said in parent company of Banco Azteca) is people environment. By threatening to penalize a note. “The robust activity and income growth with low income. The price fluctuations of financial institutions operating with crypto profile in the U.S. should keep remittances flow Bitcoin are very large. In six months, Bitcoin assets, the central bank may be encouraging strong in 2021,” said Ramos. “Solid workers’ has seen a price rise and fall of 30 percent the opposite of what the market and society remittance flows have been adding support to or more in a few days. Would poor Mexicans the current account and to private consump- be interested in buying Bitcoin with such tion, particularly for low-income families, who high volatility in value? If they believe it is The genie is out of have a high propensity to consume and are the like buying lottery tickets, they might. After the bottle, and change overwhelming recipients of such transfers.” all, it is the poor in Mexico who spend a is now inevitable.” large proportion of their income on the state — Juan Llanos lottery—Melate. After all, El Salvador, the Pandemic Leads to only country in the world to make Bitcoin a Shifts in Methods for legal tender, has seen the poor enthusiasti- at large need. Cryptocurrencies and the cally endorse the adoption.” networks they run on—crypto-networks—are Remittances: Report already replacing the infrastructure (or Juan Llanos, global compliance plumbing, as the industry likes to say) of Methods by which migrants from Latin Amer- advisor for multiple start-ups: global capital markets and payments. The ican and Caribbean countries send money “Banks have the same incentives genie is out of the bottle, and change is now back home saw changes amid the Covid-19 A to use cryptocurrencies as they inevitable. The economies that understand pandemic, according to a report released June should have to start using the latest gener- and embrace this megatrend will position 18 by the Inter-American Dialogue and Creative ation of computer systems: experimenting, themselves at the forefront of progress, Associates International. Last year, 67 percent upgrading infrastructure, improving product facilitating an upgrade of rusty, inefficient of senders of money transfers used agents, offerings, lowering costs and staying infrastructure and creating jobs for the next as compared to 84 percent in 2016. Seven abreast of cutting-edge technologies. At technology-savvy generations. I have no percent of migrants said the method they were this stage in the evolution of the industry, doubt that embracing these technologies using last year for sending remittances was warnings are certainly justified, especially with an open mind would place any country different than before the pandemic. “The shift when directed to retail investors. There is on the right side of history.” was not as large as thought, but important, a global legal and educational vacuum that nonetheless,” said the authors of the report, facilitates the offering of sophisticated Tim Jacklich, senior analyst at Manuel Orozco and Kathryn Klaas. The survey alternative financial services to the masses. Americas Market Intelligence: of more than 1,000 immigrants in the United The speed of innovation in crypto assets “On June 28, Mexico’s financial States from eight Latin American and Caribbe- space is staggering, and as is always the A authorities dashed hopes for a an countries also found that panic and stress, case, consumer education and prudential near-term Mexican crypto-revolution, which including due to working fewer hours and job regulations lag behind. The Mexican central had mounted following billionaire financier losses, has been the most difficult part of the bank’s warning—or threat, rather—to financial Ricardo Salinas’ endorsement of Bitcoin pandemic. “Factors related to income insecuri- institutions seems misplaced and rings of days prior. Referencing Banxico Circular ty and instability were mentioned by nearly one protectionism. By providing banking services 4/2019, the June 28 guidance reiterated the in three migrants surveyed in 2020,” said the to crypto-innovators after a thorough due legal boundaries for virtual asset adoption authors. “In early 2021, the responses shifted diligence process, they would not only be in the Mexican financial system. Mexican and coincided with renewed employment.” fulfilling their mission and duty, but they banks are barred from activities that ‘trans- The report also found that migrants sought to would also have the opportunity to learn and mit … the risk of virtual asset operations reduce expenses, including making changes to innovate at a much faster pace than by being to [their] clients.’ In other words, Mexican remitting habits, as well as depending more on external observers. Digital currencies are a banks may not sell cryptocurrencies to their savings and looking for a new job. The report Continued on page 6

COPYRIGHT © 2021, INTER-AMERICAN DIALOGUE PAGE 3 FINANCIAL SERVICES ADVISOR July 1-14, 2021 also said that the pandemic limited migrants’ engagement with their home countries. It also ADVISOR Q&A found correlations between higher and more frequent remittances and factors including status as an essential worker, having children in a home country and having a stronger financial Is Embracing Bitcoin the Right base. Move for El Salvador’s Economy?

El Salvador’s ruling party-con- is complex and volatile, will be a financial DIGITAL CURRENCIES NEWS trolled Legislative Assembly inclusion pathway for average Salvadorans on June 8 passed a measure who find existing options with banking, SoftBank Group Q proposed by President Nayib community credit unions or mobile money Bukele to designate Bitcoin a legal tender, too complicated or costly. Moreover, for Invests $200 Million making the Central American nation the migrants sending remittances, Bitcoin is too first in the world to do so. What are Bukele’s complicated to be attractive. I do think the in Mercado Bitcoin goals in making Bitcoin one of El Salvador’s move will attract investment to El Salvador, official currencies, and what are the major but not without significant risks. While El Japan’s SoftBank Group has invested $200 mil- benefits and drawbacks? What implica- Salvador’s security situation has improved lion in Mercado Bitcoin, one of Latin America’s tions does the move have on remittance somewhat, the country remains vulnerable largest cryptocurrency exchanges, said Roberto flows, anti-money laundering efforts and to organized crime and drug trafficking. El Dagnoni, executive chairman and CEO of 2TM the U.S. dollar, which is El Salvador’s main Salvador will need to be extremely careful Group, Reuters reported July 1. 2TM Group is currency? What potential consequences to avoid the wrong types of investment. the trading platform’s parent company. Soft- could formalizing the cryptocurrency have Attracting international tech entrepreneurs Bank Latin America Fund made the investment on the country’s program with the Inter- is one thing; attracting international money in a Series B funding round, which led 2TM’s national Monetary Fund? What does the launderers or tax evaders is another. If valuation to increase to $2.1 billion, according measure mean for businesses operating in things go wrong, the Bitcoin experiment to the firm. The investment marked SoftBank’s El Salvador? could be very costly to the country’s security largest investment in a Latin American crypto as well as its image, causing other investors, company. Mercado Bitcoin will use the raised Julia Yansura, program man- businesses and financial institutions to per- funds to scale its operations, expand offerings ager for Latin America and the ceive heightened AML/CFT risks, particularly and invest in infrastructure to meet rising Caribbean at Global Financial at the Bitcoin-to-dollar conversion point. As demand for cryptocurrency in the region, 2TM Integrity: “El Salvador’s GDP the country updates its regulatory framework said in a statement. The move came at a time A contracted nearly 9 percent in 2020 during in preparation for Bitcoin, it would do well when investor sentiment on cryptocurrencies is the Covid-19 crisis, and full recovery is not to evaluate its overall AML/CFT system and faltering amid regulatory crackdowns in China, expected until 2023. Meanwhile, external address existing weaknesses in light of the Britain and Japan, Reuters reported. debt is rising. In this difficult economic big changes that lie ahead.” context, the country is trying to find solu- tions. President Bukele has said Bitcoin POLITICAL NEWS will promote financial inclusion, facilitate EDITOR’S NOTE: More commentary on this remittances and attract investment to the topic appears in the June 15 issue of the Cuba Arrests More country. Some of these make more sense Latin America Advisor. than others. It’s unlikely that Bitcoin, which Than 100 Amid The Wall Street Journal reported. Activists try’s most important opposition group, accord- Massive Protests said the Communist government had deployed ing to human rights organizations. Thousands security forces across the country and arrested of people took to the streets of cities across Cuba’s government cracked down on demon- more than 100 people, many of whom disap- Cuba starting in San Antonio de los Baños, strators and activists during the second day of peared, including well-known dissidents and southwest of Havana, on July 11 in anti-gov- massive nationwide protests on July 12, also civil rights activists. Among them are visual ernment protests unprecedented in a country cutting off Internet access on the island as well artist Luis Manuel Otero, poet Amaury Pacheco with tight police control and constant surveil- as most communication with the outside world, and José Daniel Ferrer, the leader of the coun- lance, the newspaper reported. Demonstrators

NEWS BRIEFS demanded President Miguel Díaz-Canel step ECONOMIC NEWS down as the country struggles amid a shortage U.S. Restricts Visas of of basic goods, rising coronavirus cases and a ECLAC Predicts 5.2% 100 Nicaraguan Elites dire economic situation. Protesters are also de- nouncing the Cuban government’s long-stand- Growth, Warns of The administration of U.S. President Joe ing curbs on civil liberties, The New York Times Biden on July 12 announced visa restrictions reported. Government officials blame Cuba’s Covid-19’s Impact on 100 members of Nicaragua’s political and economic struggle on the decades-long U.S. judicial elite in response to the Sandinista embargo. “Cubans know perfectly well that the Projected economic growth for this year in Lat- government’s crackdown on opponents over government of the United States is principally in America and the Caribbean will not reverse the past month, The Hill reported. Among responsible for Cuba’s current situation,” the the adverse effects of the pandemic, the U.N. those targeted are members of Nicaragua’s foreign ministry said on Twitter following Economic Commission for Latin America and National Assembly and its judicial system. the protests. The demonstrations on July 12 the Caribbean, or ECLAC, said in a report pub- Though the State Department did not publicly extended to Tampa, Fla., where hundreds of lished July 8. Though ECLAC raised its average name the individuals, it said they are believed people gathered calling for freedom and de- growth outlook for the region to 5.2 percent, to be responsible for or complicit in the recent mocracy in the island nation. Florida has been up from a previous estimate of 3.7 percent, arrests of at least 26 opponents of President a common destination for Cuban migrants the commission has warned that the social Daniel Ortega. fleeing the country. U.S. President Joe Biden impacts of the crisis are worsening and will on July 12 showed support for protesters in continue as the economy picks up following a Cuba. “We stand with the Cuban people as they stark 6.8 percent contraction in 2020. ECLAC Argentina Denounces bravely assert their fundamental and universal expects Panama, Peru and Chile to see the Macri Over Alleged rights, and as they call for freedom and relief best economic performances this year, with from the tragic grip of the pandemic and from Weapons Delivery to Áñez the decades of repression and economic Argentina’s government on July 12 formally suffering,” Biden said in a statement. denounced former President Mauricio Macri and nearly a dozen officials of his administration for allegedly sending arms and ammuni- Venezuelan Agents tion to Bolivia amid protests two years ago, Arrest Opposition the Associated Press reported. According to current President Alberto Fernández’s gov- Politician Guevara ernment, Macri’s administration donated tear Bárcena // FiIe Photo: ECLAC. gas, grenades and other “repressive material” Prosecutors in Venezuela said July 12 that they to the government of former Bolivian interim had charged opposition figure Freddy Guevara expansions of 12 percent, 9.5 percent and 8 President Jeanine Áñez during several weeks with treason, terrorism and other charges, percent, respectively, Reuters reported. Mean- of unrest in November 2019. Reuters reported. Agents arrested Guevara, a while, Brazil, the region’s largest economy, is close ally of opposition leader Juan Guaidó, projected to grow by 4.5 percent, and Mexico after stopping his car as he traveled along a and Argentina to expand 5.8 percent and 6.3 Chile Boosts Economic highway in Caracas. Guaidó said armed men percent, respectively. However, “this expansion threatened to arrest him as he left his apart- … will not manage to ensure sustained growth, Growth Outlook to 7.5% ment in order to assist Guevara. Venezuela’s because the social impacts of the crisis and Chile’s government on July 12 revised its eco- chief prosecutor’s office said it had sought the structural problems in the region have nomic growth outlook for 2021 to 7.5 percent, a warrant to arrest Guevara over his alleged deepened and will continue to do so during up from a previous forecast of 6 percent, “ties with extremist groups and paramilitaries the recovery,” the U.N. organization said in the Reuters reported. Among the factors driving associated with the Colombian government,” report. “We need policies for transformative the expected economic expansion are high- Reuters reported. After he was stopped, Gue- recovery with an emphasis on investment. er-than-expected domestic demand for goods vara broadcast a short video via social media, Industrial policies and technologies to drive and services as well as record high prices for apologizing to his family for their “suffering.” growth in sectors that are more technology copper, the country’s top export, and an effec- The arrest came as Venezuela’s government intensive and that generate quality jobs [and] tive vaccination campaign, though officials and the opposition prepare for talks that are to restructure health and education systems,” said warned that the pandemic is not yet over. take place next month in Mexico. Alicia Bárcena, the head of ECLAC.

FEATURED Q&A / Continued from page 3 FINANCIAL SERVICES ADVISOR iis published biweekly by the Inter-American Dialogue ISSN 2163-7962 clients, nor act as custodians of clients’ acceptability and accessibility factors, in- virtual assets. Though disappointing to cluding lack of regulatory support. However, Erik Brand Publisher crypto maximalists, this prohibition insulates we recognize that banks could benefit from [email protected] Mexican deposits from the persistent risks new business activities related to digital Gene Kuleta of cryptocurrency price volatility, and wisely currencies, such as custody services, which Editor so, as evidenced by Bitcoin’s 50 percent could generate a new source of fees and [email protected] price collapse in May. Stablecoins tend to contribute to better revenue diversification. Anastasia Chacón González be more reliable but can still pose finan- Mexican regulators are concerned about the Reporter & Associate Editor cial system risks, given the challenges of [email protected] auditing underlying assets and the murky legal status of smart contracts. That said, Incentives for banks Mexico’s regulatory framework still leaves to start using cryp- room for compelling crypto integrations. tocurrencies are still Michael Shifter, President Mexican financial institutions may, with limited because of Rebecca Bill Chavez, Nonresident Senior Fellow Banxico’s authorization, utilize blockchain acceptability and ac- Bruno Binetti, Nonresident Fellow technology and contract third-party crypto cessibility factors...” Sergio Bitar, Nonresident Senior Fellow exchanges to enhance ‘internal operations,’ Joan Caivano, Senior Advisor — Alfredo Calvo including international funds transfers. Kevin Casas-Zamora, Nonresident Senior Fellow Mexican banks might, for example, employ Julia Dias Leite, Nonresident Senior Fellow a permissioned blockchain for internal potential risks that digital currencies could Ariel Fiszbein, Director, Education Program settlements or to secure transaction data. bring to the financial system and to their Sandra García Jaramillo, Nonresident Senior Fellow This regulatory regime could also permit customers. In Mexico, financial institutions Selina Ho, Nonresident Senior Fellow consumer-facing crypto products that do are not allowed to finance leveraged crypto- Edison Lanza, Nonresident Senior Fellow not require banks to directly hold or process currency positions—neither receive them as Nora Lustig, Nonresident Senior Fellow Margaret Myers, Director, Asia Program virtual assets. Crypto-linked debit cards, for collateral, nor offer them to clients. In our Manuel Orozco, Senior Fellow instance, enable crypto balances to be spent view, if banks were able to do these activ- Xiaoyu Pu, Nonresident Senior Fellow through instant crypto-fiat conversions by an ities, there would be risks to consider. For Jeffrey Puryear, Senior Fellow exchange; issuing banks need never handle instance, the possible use of cryptocurren- Tamar Solnik, Director, Finance & Administration the cryptocurrency. The door for blockchain cies in illegal activities could expose banks Lisa Viscidi, Director, Energy Program innovation remains open in Mexico.” that accept such instruments to operational Denisse Yanovich, Director of Development and legal risks, in case authorities identify Alfredo Calvo, senior director them as participating in money laundering Financial Services Advisor is published and sector lead for financial activities. This could damage banks’ repu- biweekly, with the exception of major holidays, by the Inter-American Dialogue at institutions ratings at S&P tations and affect their competitive position 1155 15th Street NW, Suite 800 Global Ratings: “S&P Global and profitability. In addition, direct exposure Washington, DC 20005 A www.thedialogue.org Ratings still sees cryptocurrencies more to cryptocurrencies or operating on behalf as speculative instruments than payment of customers could be an additional channel Subscription inquiries are welcomed at [email protected] vehicles that could substantially disrupt the of transmission to banks. Moreover, banks financial system. The increased interest could also be exposed to product mis-selling The opinions expressed by the members of the Board of Advisors and by guest commentators do not necessarily from investors in cryptocurrencies responds risk if pros and cons are not transparently represent those of the publisher. The analysis is the sole to the low interest rate environment, sound explained to customers. Finally, exposure to view of each commentator and does not necessarily liquidity and the expectation that inflation cyber risk would be an additional challenge.” represent the views of their respective employers or firms. The information in this report has been obtained from could pick up in certain regions, as well as reliable sources, but neither its accuracy and completeness, high valuations on stock markets. In our The Advisor welcomes comments on its Q&A nor the opinions based thereon, are guaranteed. If you have any questions relating to the contents of this publication, view, incentives for banks to start using section. Readers can write editor Gene Kuleta contact the editorial offices of the Inter-American Dialogue. cryptocurrencies are still limited because of at [email protected]. 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