Name
Global FinTech Guide
Country Name
Chile
SectionTitle
DLT and cryptocurrencies
Body
FinTechs belonging to this category offer financial services using crypto currencies. This category also includes FinTechs utilising blockchain and distributed ledger technologies (DLT) upon which Bitcoin and Ethereum are based, among others. FinTechs develop and do research in this field in order to create new services – e.g. crypto currency exchange markets, wallet providers, NFTs-related services, new payment services, "smart contracts" or new clearing and settling services.

Introduction

Attitude of the country towards financial services using crypto currencies

There is no specific regulation for crypto currencies in Chile, nor for their issuers or intermediaries, and the relevant authorities have said that they cannot be considered as “currencies” in the legal and conceptual sense of the term.
 
Despite the lack of a specific regulation, to date, two (2) virtual currencies have been created in Chile: (i) Chaucha (CHA – https://chaucha.io/) and (ii) Luka (LUK – https://www.cryptoluka.cl/), and without actually being a cryptocurrency, the WEA token (Chilean Ethereum token).

In March 2018, three (3) Chilean cryptocurrency exchanges saw heavy press coverage due to a banking blockade whereby either their accounts were shut down by their current banks or other banks refused to open new accounts. In April 2018, the affected exchanges filled actions against the banks before Chile’s Competition Court and Appeals Courts who determined that the banking accounts should be reopened. Tax authorities have also stated that on matters relating to the taxation of income derived from the purchase and sale of cryptocurrencies it’s necessary to declare and pay taxes on these operations, as the profits obtained from the purchase and sale of cryptocurrencies are taxable income .

In 2021, the Chilean Central Bank announced the evaluation of the possibility of issuing a Chilean cryptocurrency (stablecoin)  .

Legal affairs

Obligations and requirements to provide financial services using crypto currencies described above

There is no specific regulation regarding virtual currency in Chile. Accordingly, and apart from general rules applicable to service providers (such as initiation of activities before the Chilean Internal Revenue Service), there generally are no specific license, minimum capital, or solvency requirements.

Additional comments regarding the legal situation for financial services using crypto currencies or what FinTech’s must be aware of in this business area

Despite the Bill (Bulletin No. 14570-05), crypto currencies do not currently have a specific legal or regulatory recognition in our country. Furthermore, they do not correspond to legal tender and cannot be understood as foreign currency or currency for the purposes of exchange legislation.

Economic conditions

Market size for financial services using crypto currencies and biggest companies in this business area

Information regarding revenues, transactions and users is not readily available.

Additional comments regarding the economic situation for financial services using crypto currencies or what FinTech’s must be aware of in this business area

N/A.

Authors

Disclaimer

© 2022, Urenda Rencoret Orrego & Dörr. All rights reserved by Urenda Rencoret Orrego & Dörr as author and the owner of the copyright in this chapter. Urenda Rencoret Orrego & Dörr has granted to Multilaw non-exclusive worldwide license to use and include this chapter in this guide and to sublicense Lexis Nexis, a division of RELX Inc. and its affiliates certain rights to use and distribute this guide.

The information in this guide provides a general overview at the time of publication and is not intended to be a comprehensive review of all legal developments nor should it be taken as opinion or legal advice on the matters covered. It is for general information purposes only and readers should take legal advice from a Multilaw member firm.

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