Panama’s regulator may ‘swing the axe’ after Bitcoin-friendly bank bans use of crypto mixers
Panama’s “bitcoin (BTC) and crypto-friendly” bank Tower Bank says it will prevent its customers from using crypto mixers – in the wake of the US Office for the Control of Foreign Assets (OFAC)’s transition to sanctions Tornado Cash earlier this month.
As previously reported, OFAC has added the Ethereum (ETH) powered crypto mixing service to its list of specially designated nationals, with Dutch police arresting a suspected Tornado developer as “facilitating money laundering” this week.
Latin American parties are also reacting – with Towerbank apparently taking the lead in Panama. However, experts have stated that it is likely that the Panamanian banking regulator will follow up with a move of its own.
CriptoNoticias reported that Towerbank users who use Tornado may face sanctions such as account suspension or further penalties.
The media quoted the head of the bank’s crypto and blockchain department, Gabriel Campa, as stating that crypto mixers “are often used for illegal activities.”
He suggested that the bank agreed with OFAC’s move, but indicated that the ban would not necessarily be retroactive.
Campa said:
“If you’re someone who used mixers years ago, we need to analyze [your case]because it may not have constituted illegal conduct at the time.”
Towerbank has positioned itself as the bank of choice for crypto investors, offering dedicated crypto accounts and a Visa debit card that allows users to “operate with digital assets.”
But Campa dismissed the idea that Towerbank could move away from the crypto space, saying:
“Bitcoin and cryptocurrencies are here to stay, so our bank needs to be a part of it.”
Rodrigo Icaza, CEO of Panamanian Chamber of Digital Commerce and Blockchainargued that the banking regulator Superintendent of Banks of Panama (SBP), is likely to be spurred into action by the Towerbank move.
Icaza believed that the SBP would likely “swing the axe” against coin mixers and called on the crypto community to “be aware and act cautiously” to win the “trust” of the banking sector.
He added that the bitcoin community needed to be “formalized” and should work “with regulations”, rather than seeking to circumvent them.
Icaza encouraged the community to self-regulate by producing annual reports on crypto holdings and crypto-related income. This, he said, would allow banks to build up profiles of potential crypto customers – and would allow crypto holders to gain more trust from banks.
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Learn more:
– Tornado cash ban blows wind from both division and unit through the crypto community
– Panama’s “Lost Crypto Opportunity”
– Panama MP: Our draft crypto law is different from El Salvador’s Bitcoin law
– Crypto bills in Panama, Brazil develop rapidly, but Argentina province issues mining alert
– Banking giant Santander to offer crypto trading to Brazilians as crypto ‘is here to stay’
– Portuguese banks stop offering services to crypto exchanges, citing “Risk” as the reason
