Itaú loses action against Bitcoin brokerage firm that had account closed

Process that ran since 2018 gave cause to fintech of cryptomoedas, which will have its account kept in two banks.

Banco Itaú lost a lawsuit against a Bitcoin brokerage house in a lawsuit that had been running since 2018. Another institution that was cited in the lawsuit was BancoEstado, which also lost the lawsuit.

After having banking services terminated by the banks, the Chilean broker went to court. The two banks were accused of wrongly shutting down the services once offered to the institution.

As a result, Buddha’s legal department sought out the Free Competition Defense Court (TDLC) in Chile. In Brazil, an equivalent body would be Cade, which has also been judging problems of Bitcoin brokers against banks for some years.

In 2018, a TDLC ruling stated that banks could not close Crypto Genius brokerage accounts in Chile.
Itaú loses lawsuit against Bitcoin brokerage house in the courts, and must continue to provide services

According to Diario Financiero de Chile, the case was judged in the last days of 2020.

In the report, Itaú Chile and BancoEstado appealed to TDLC to close the bank account of Bitcoin Buda brokerage house.

The justification for the action would be that the Buddha facilitated a coup d’état by a front company. At this point, at least four Buddha’s clients would have been injured by the coup, losing U$ 100 million at the time.

Itaú then accused the brokerage house of allowing the indirect use of the bank systems, by other brokers. This way, with high risk in the operations, Itaú asked to rescind the Buddha account in justice.

According to the Chilean judiciary, banks cannot close Bitcoin brokerage accounts. Unilateral closing of accounts violates the principle of free competition, and since 2018 has been a prohibited practice.

In keeping with its reasoning, the courts rejected the request of Itaú Chile and BancoEstado against the Buddha brokerage house. In other words, the possible coup committed against Buddha clients would not be a fact that could cause Itaú to close the account of Bitcoin brokerage house.
In Brazil the brokerage accounts are closed unilaterally often

If in Chile the understanding about closing brokerage accounts is a closed issue, in Brazil the problems continue. This is because the country’s banks continue to close Bitcoin brokerage accounts unilaterally.

In Cade, the federal agency responsible for monitoring unfair competition practices, still investigates the case. After the agency closed the investigation, the case was analyzed again in 2020.

In early December 2020, however, Cade said it will continue to investigate the matter. The closure of brokerage accounts damages the business of these companies, which still depend on the traditional financial system to maintain their operations.

Brazil has a scenario of little regulation on cryptomorphs today, with the closure of accounts of those who deal with cryptomorphs a persistent problem. And not only brokers have problems, because Bitcoin’s P2P sellers are also harmed by these actions.

In Chile, a nearly neighboring country, however, banks are unable to close brokerage accounts because of threats to free competition. Will this understanding also be held by Cade in Brazil?