Judge Rule in Favour of Chilean Bank Which Closer Explanation Account Without Explanation

Judge Rule in Favour of Chilean Bank Which Closer Explanation Account Without Explanation

cryptocurrencies exchange

A court in Chile has ruled in favour of a state-owned Bancoestado, which recently closed the account of a cryptocurrency exchange — Orionx, without stating any reason for its actions. According to the Judge in charge of the ruling, the bank has “acted in compliance with laws on laundering and terrorist financing, a threat allegedly posed by censorship-resistant, decentralized cryptocurrencies.”

Cryptos are not Banned, but Illegal

In Chile, Commercial banks have the right to close down exchange accounts without giving any notice to them. This is in accordance with the country’s laws on money laundering and terrorist financing. It is important to note that cryptocurrencies are not legally recognized in Chile, however, they are not banned in the country.

Based on a recent report from a local media, the Supreme Court made it known that digital assets lack “physical manifestation” and “have no intrinsic value.”

Particularly, the supreme court has issues with the fact that the crypto industry, within its borders is not governed by governments or companies.

As a result of this “these characteristics and elements determine, therefore, the current impossibility for the bank to comply with the aforementioned obligations, ”

The court paper stated that:
“It prevents it from knowing in depth (of)the financial activities related to cryptocurrencies developed by the appellant, the most relevant characteristics of its operations, the foundations on which these are supported and, finally, if their amounts are excessive or not.”

The court paper continued by stating that:
“It is precisely this impossibility of knowledge and of fulfilling the duties that weigh on the bank, which gives support to the decision to close the bank account of the plaintiff, which consequently cannot be called arbitrary.”

The ruling of the court has been described by some key members of the crypto market to be a major set back for the crypto industry.