Chilean Court Rules In Favour of Crypto Exchange Buda

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  • The conflict involving banks Itaú and BancoEstado against Buda.com began in 2018, with the banks alleging fraud on the latter’s part. 
  • Failure to present sufficient evidence by the banks led to the court supporting Buda’s defense.
  • The court’s ruling is being seen as a victory for the crypto industry in Chile.

Banks Ordered to Serve Current Account Services to Buda

The Free Competition Defense Court (TDLC) of Chile has ordered two prominent banks – Itaú and BancoEstado – to continue maintenance of the bank accounts of Buda.com, a cryptocurrency exchange, wherein trading is done either using a web-based platform, or a mobile app.

In the dispute, which began in 2018, both the banks accused Buda.com of having committed fraud against its clients through their platform. The accounts of Buda were closed in both the banks on the aforementioned grounds. Despite filing these allegations, they were unable to provide enough evidence in court to establish the crypto exchange’s participation in any fraudulent activity.  

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These assertions against the crypto exchange began in relation to a Ponzi scheme by a bogus company called Terra Finance, which led to 100 million Chilean pesos being lost by four victims of the scam. This defraud was linked to Buda.com, and the banks claimed that the platform knowingly did nothing concrete to stop the company from conducting such scams, in turn facilitating these activities on their platform with complete knowledge.

These claims were not backed by sufficient proof, and hence were rejected by the court. 

Buda Receives Precautionary Measure From Court

Notwithstanding the appeal to cancel the precautionary measure made by the banks, Chile’s tribunal promptly rejected it. The court also maintained that despite the new information presented, both entities have contravened free competition with relation to Buda.com’s platform for cryptocurrency exchange. 

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“The new information presented does not undermine the serious presumption of the right that is claimed or of the facts denounced in the lawsuit,” the court said.

Celebratory Decision for Crypto Industry in Chile

Prominent members of the cryptocurrency industry in Chile view the court’s decision in a positive light. Vocally applauding this decision, Cristóbal Pereira, director of the Blockchain Summit Latam, tweeted the ruling as great news towards the end of 2020. 

This regulatory approach is being cited as a right step towards integrating the crypto business into the regular financial market of Chile.

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Andrew Smithhttp://thecoinrepublic.com
Andrew is a blockchain developer from his education and developed his interest in the cryptocurrencies while his post-graduation. He is a keen observer of details and shares his passion for writing along with being a developer.

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