Belarus has made a major move in incorporating digital assets into its financial system by launching a regulatory framework for “cryptobanks”. President Alexander Lukashenko’s Decree No. 19 describes the regulations and requirements for cryptobanks to function, allowing them to mix token-based operations with banking services.
Regulatory Structure and Oversight
The decree redefines cryptobanks as joint, stock companies authorized to simultaneously provide token, based and traditional banking, payments, and other financial services.
After obtaining consent for resident status in the country’s Hi, Tech Park, cryptobanks have to get registered in a special list kept by the central bank in order to run their businesses.
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Opportunities and Challenges
The framework enables cryptobanks to develop new hybrid financial products that combine traditional banking services with token, based transactions, thereby potentially increasing accessibility and saving time. Nevertheless, the regulatory structure limits the participants only to those firms that agree to operate under the national regulatory framework.
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Implementation and Implications
The decree on crypto banks follows several years of gradual policy signaling that have stressed the need for both control by the state and innovation.
The new legislation aims to not only facilitate the positioning of Belarus as a financial IT hub, but also to find solutions to the economic challenges caused by international sanctions and the increasing popularity of digital tokens for cross, border transactions.
By setting up a regulatory framework for crypto banks, Belarus has taken a major step in its handling of digital assets.
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