The Argentinian government has ordered the seizure of 1,269 cryptocurrency wallets of taxpayers with outstanding debt obligations, according to iProUP.
The announcement comes after the country’s Federal Administration of Public Income outlined plans to crack down on cryptocurrency wallets of the tax evaders in May. The regulator also ordered the digital assets exchanges and crypto firms to submit monthly user reports.
Crypto service providers are now required to run KYC processes and maintain a register of their users. The companies must also provide financial records, including income, expenses, and monthly balances.
The disclosures from the firms have reportedly enabled the tax agency to implement controls on the holdings in the wallets of the tax delinquents. AFIP is now going after the tax offenders’ bank accounts and liquid assets, seizing them from citizens who cannot settle their obligations.
The move by the AFIP comes amid Argentinians’ growing adoption of cryptocurrency. The users see it as a way of mitigating the rising inflation rate and the devaluation of the country’s currency.
Argentines Turn to Crypto Amid Soaring Inflation
Despite the crackdown, Argentina’s administration has lauded the importance of cryptocurrencies in the current challenge of the high inflation rate. In recent comments, the nation’s central bank president Miguel Pesce said he will ‘regulate the intersection of bitcoin with the payment system and exchange market.’
A report from the Americas Market Intelligence shows that Argentina has recorded a surge in cryptocurrency adoption, beating other regional jurisdictions. During the pandemic, Argentinians received a moratorium from AFIP as the regulator sought to mitigate the severity of the impact.
The cryptocurrency crackdown comes amid a bearish momentum in the digital asset space. Bitcoin (BTC) is currently trading below $20k, with multiple altcoins having recorded an extended decline in the recent past.