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https://www.flickr.com/photos/105644709@N08/

https://www.flickr.com/photos/105644709@N08/

In a move aimed at protecting its national currency, the boliviano, Bolivia’s central bank official prohibited the use of bitcoin and other cryptocurrencies today. Although the policy was created by El Banco Central de Bolivia back in early May, it has only recently become known to the general public following a story by Spanish-language news outlet PanAm Post. According to the central bank: “It is illegal to use any kind of currency that is not issued and controlled by a government or an authorized entity.”

The ruling extends beyond bitcoin, which is rapidly gaining media attention in Latin America, and includes other digital currencies such as namecoin, peercoin and Quark. With companies like BitPagos seeking to expand into multiple Latin American markets, the Bolivian central bank’s move is the first clear indication that bitcoin is now on the radar of regional financial authorities.

Speaking with CoinDesk, Christian Nubis from Latin American exchange Bitex.la downplayed the Bolivian central bank’s ban, noting:

“Bolivia is not a leader in the region on matters of public policy.”

Bolivia has been following a program of aggressive industrialization over the past decade, allowing it to experience high levels of growth compared to neighboring countries. In 2013, Bolivia’s GDP saw 6.8 percent expansion, with tight currency controls at least partially responsible for that gain. Although there is little evidence that bitcoin would cause significant capital flight from the country, similar protections are already in place in countries like China, where bitcoin has been informally “banned” from the banking system for months.

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