Uruguay Urged to Provide Services to Cannabusiness – Or Bitcoin Will

Former president of Uruguay’s National Drugs Board, Leonardo Costa, has warned the Banco Republica Del Uruguay (BROU) it must be “more proactive” in providing financial services to the cannabis industry, otherwise, bitcoin will step in to take its place. As with the United States, Uruguay’s legitimate marijuana industry has struggled with accessing banking and financial services.

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Costa Is Concerned That If BROU Fails to Offer Financial Services to the Cannabis Industry, That the Industry Will Be Forced to Adopt Bitcoin

Uruguay National Bank Urged to Provide Banking Services to Cannabis Industry, Otherwise Bitcoin Will

Attorney Leonardo Costa has told local media that Banco República del Uruguay must be “more proactive” in ensuring that the actors within the legitimate cannabis industry are able to access financial services. “It is a public policy that can not fail because of this,” the former president of Uruguay’s National Drugs Board stated.

Costa is concerned that if BROU fails to offer financial services to the cannabis industry, that the industry will be forced to adopt bitcoin as its principal medium of circulation. “Bitcoin is a way of circumventing these problems that, in some countries, are being the alternative for cannabis businesses, or businesses of this type, “he stated.

“The Republic Bank Must Assume [It’s] National Banking Role” – Leonardo Costa, Former President of Uruguay’s National Drugs Board

Uruguay National Bank Urged to Provide Banking Services to Cannabis Industry, Otherwise Bitcoin Will

Uruguay media has recently reported the closure of bank accounts associated with cannabis dispensaries and producers on the part of private banks. The BROU has not yet stated an official position regarding the marijuana industry – although it is rumored that the bank will make a decision in coming weeks.

Leonardo Costa told media that “there are banks that, by disposition of their parent companies, have decided based on a risk analysis, not to work with those substances or businesses that work with those substances.” Costa also suggests that some banks may have legal reservations regarding the marijuana industry, as “money from the marketing of prohibited substances could be considered money laundering since drug trafficking is a precedent of money laundering… [Banks] understand that it is a high-risk environment”.

Costa has articulated his roadmap for ensuring financial inclusion regarding the cannabis industry. “First, that the banking supervisor gives him some legal framework, no doubt. Without that, it is very difficult. Second, there are banks that, like the Republic Bank, must assume their national banking role… if none of that happens, this will end in bitcoins. Do not doubt it.”

Do you think that if Uruguay’s national bank fails to facilitate financial inclusion for the cannabis industry, cryptocurrencies will step in? Share your thoughts in the comments section below!

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  • It seems like the Banks that have agreed to service Uruguay have foreign influence. The Government of Uruguay must resolve this issue or lose processing of additional GDP for their Country. As for the cannabis trade in Uruguay, they should have been in alternate currencies or forms of payment a long while ago. Its a bold move to try and push foreign controlled banks to handle their proceeds. I would refer the cannabis trade to Central Bank of Uruguay’s Decree Act No. 15.322 of September 17, 1982, as it references compliance to “sanctions”, “secrecy” of institutions, and “state owned or not”. I am certain some banker advised them not to write “cannabis” as a description of business and further advised them of alternate conveyances or they were doing that and got caught misrepresenting and therefore sanctioned. There has to be more to this story.

  • Liberty88

    Huh….. Well looky there – a politician who’s got a brain.
    Either accommodate or get “accommodated.”

  • Gabriel Nomas

    I’m Uruguayan.
    I don’t think they will fail. The worst scenario could be the pharmacies having to move their accounts to the Republic Bank.

    • Billy Williams

      You are right . Your country will use its bank.