Cryptocurrencies are all the rage all around the world. Most developed markets are taking a keen interest in the various digital currencies and there has been a huge support for them. The available cryptos have in turn grown by leaps and bounds to the extent where the level of their value in the economies cannot be overlooked.
These digital currencies are presenting challenges for Costa Rica and Latin American governments as a whole. There is not yet a consensus on which direction the state institutions should take in regard to digital currencies. Many pundits already have a positive attitude towards the digital currencies because of existing supportive concepts of currency in Costa Rica.
A desirable attitude alone won’t be enough to gauge the impact of cryptocurrencies in Costa Rica though. Other financial factors like the banking sector will also be crucial to determining exactly how much freedom will be given to the digital currencies. According to CryptoTraderPros, a decentralized currency might have different impacts depending on the size and type of the economy.
Costa Rican economists are mainly concerned about mitigating the effects of cryptocurrencies on the market. The position of the economists is that the virtual currency is, in fact, more of a technological product than an asset for commercial transactions.
The transactions that might be going on in the country currently are thus being treated as risky ventures that are not under the regulation of government. The fact that economists are skeptical about digital currencies means that there is a stronger preference for the central authority as the only issuer of legal tender.
The financiers in Costa Rica are almost completely against the cryptocurrencies. For them, there can only be one issuer of currency and that is the legal institutions. There is thus not only a legal challenge but also a commercial challenge. The financiers find the use of cryptocurrencies to be problematic for revenue collection too.
Legal professionals have also portrayed apparent skepticism on cryptocurrencies. It has been the observation of analysts that unregulated currencies have the potential of heightening organized crime. Analysts from the tech fields have obvious support for cryptocurrencies and they have criticized the inexperience of local economists.
The opinions of the majority of economists also seem to be in line with what the Central Bank of Costa Rica opines. A sanction has been put forth by the institution that targets cryptocurrency buyers. Violators stand to have their accounts eliminated by the central bank. The same law exists in other Central American countries even though they do not explicitly prohibit the marketing or promotion of cryptocurrencies.
Costa Rica is an early adopter of technology – the prevailing notwithstanding. Even though there seems to be a lack of a progressive attitude in cryptocurrency, the approach that the government has taken is that of caution and steadiness. It is appreciable that precaution and supervision are in the foremost minds of the government and professionals.
Cryptocurrencies present great opportunities but also complex problems. The cautious optimism evident in Costa Rica is thus great for giving investors and other shareholders in the economy confidence. The most important thing right now is the fact that Costa Rica is not opposed to technology but it wants to follow innovation with the required caution.