Brazil CADE Probes Banks for Stifling Crypto Markets

CADE, Brazil’s antitrust watchdog, has initiated a probe into several major banks, which are accused of limiting the potential of crypto exchanges and crypto brokers.

Brazil’s Administrative Council for Economic Defense (CADE) started on Tuesday an investigation targeting some of the country’s largest banks as the antitrust regulator suspects them of using their market position to limit cryptocurrency trading to the detriment of brokers and crypto exchanges, Reutersreports.

CADE is investigating alleged monopolistic activities from Banco do Brasil, Banco Santander Brasil, Banco Bradesco, Itau Unibanco Holding, Banco Inter, and cooperative bank Sicredi.

The inquiry was requested by the Brazilian Association for Cryptocurrency and Blockchain (ABCB) in June of this year. The organization, which was established in April 2018, stated that the banks were shutting down the accounts of crypto brokers, thus taking advantage of their monopolistic positions. Interestingly, the head of the ABCB is Fernando Furlan, a former president of CADE and once a team member at the Brazilian National Development Bank.

CADE noted in a report that “in fact, the main banks are imposing restrictions or even prohibiting access to the financial system by cryptocurrency brokerages.”

The agency started an investigation based on the collected information. The banks responded to CADE’s allegations by saying that the accounts were indeed closed, but it was done due to the lack of client data required to prevent money laundering practices.

Brazilian investors have become avid supporters of cryptocurrency trading, and they currently hold more crypto accounts than stock-related accounts.

Earlier this year, Brazil’s Securities and Exchange Commission (CVM) prohibited investment funds from trading in Bitcoin and other cryptocurrencies. However, the regulator subsequently softened its stance and allowed indirect ownership.

Last year, the head of Brazil’s central banksaidthat Bitcoin was a bubble and compared it to a pyramid scheme.