Honduras Financial Authority, CNBS, Prohibits Banks from Engaging in Cryptocurrency Transactions

The financial authority in Honduras has put a halt to cryptocurrencies, with the National Banking and Securities Commission (CNBS) forbidding banks under its jurisdiction from engaging in crypto activities.

The CNBS has indicated that “maintaining, investing, intermediating or operating with cryptocurrencies, crypto assets, virtual currencies, tokens or any other similar virtual asset” will be prohibited for the nation’s financial entities.

Pointing to the unregulated characteristics of cryptocurrency and the associated risks of fraud, money laundering, and financing of terrorism, the CNBS resolution effectively prevents banks, investment companies, and other financial institutions from participating in any cryptocurrency-related activities, including holding, investing, or facilitating transactions.

See Also: This Is How Chinese Crypto Traders Have Been Bypassing The Crypto Ban

Honduras features several crypto-friendly projects, such as Bitcoin Valley and the special economic zone of Próspera, where Bitcoin is recognized as legal tender.

Nonetheless, the central bank of Honduras had earlier cautioned against the use of cryptocurrencies and is exploring the possibility of launching its own digital currency.

While cryptocurrency exchanges continue to function without restrictions in Honduras, traditional financial institutions are now barred from entering the digital asset market.

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