- Banks ordered to reopen accounts within five days
- Brazilian cryptocurrency exchanges have had a rough time with banks closing their accounts
- Several crypto-related legal challenges are going on Brazilian courts against banks
The two banks reopened the bank accounts of the Bitcoin exchange following an injunction that “forced” them to reopen the accounts within five days. This follows an appeal by Bitcoin Max’s lawyers to a Federal District Court Judge.
Banco do Brasil and Santander have complied with a court order that asked them to reopen the accounts of Criptomoedas brokerage, a Brazilian cryptocurrency exchange. The court granted the favorable judgment under a special injunction called “the early protection of urgency” that gave Santander five days to reinstate the closed bank accounts, as the hearing continues. Non-compliance would have cost Santander R $5,000 and Banco do Brasil up to R$ 20,000 in fines, respectively.
The lawyer representing the brokerage Leonardo Ranna told local news outlet Portal do Bitcoin that the bank accounts of AL- INFORMÁTICA LTDA –ME, which if the official name of Bitcoin Max have been restored together with those of exchange partners.
Brazilian cryptocurrency exchanges have had a rough time as many banks closed doors on them. Brazil’s Administrative Council for Economic Defense (CADE) announced in September it was investigating the surge of cases by leading banks to deny cryptocurrency businesses banking services. CADE launched investigations following a complaint from the Brazilian Association of Cryptocurrency and Blockchain (ABCB).
Some of the banks that CADE said were implicated in the probe included Santander Brasil, Banco Inter, Itaú Unibanco, Bradesco, Sicredi and Banco do Brasil. CADE was concerned that the restrictions imposed by the banking institutions were hampering or blocking cryptocurrency exchanges and crypto-related brokerages from accessing banking services.
There are several legal challenges going on between banks and crypto-related businesses in the Brazilian legal system due to the crypto-related businesses having banking facilities withdrawn from them. While banks maintain they are only concerned about the origin of the money flowing through cryptocurrency accounts, the ABCB president Fernando Furlan is concerned about the practice of closing accounts. Furlan said:
“It’s worrying. From a competition point of view, it’s complicated, there is a refusal to negotiate, and the justification is very strange, and it has the potential to be a case even before CADE.”
In the latest decision, judge Ana Catarino said the banks lack of communication about closing the exchanges accounts amounted to abusive conduct that is prohibited by the country’s consumer protection laws.
Reports show that Banco do Brasil even held $32,300 of the exchange’s funds in limbo. The September 12, 2018 lawsuit was initially denied but Judge Fátima Rafael, from the Federal District Court, ordered the bank to reopen Bitcoin Max’s accounts within 24 hours or face a $540 fine per day.