Tuesday, January 18

Argentina: bitcoin could hit the stock market

Key facts:
  • A futures-based bitcoin stock product would be the first step into the Argentine market.

  • The Matba Rofex price index for bitcoin is already published on the company’s website.

Matba Rofex, Argentina’s main futures stock market, gave details about a project submitted to the National Securities Commission (CNV) that would allow it to trade products based on bitcoin (BTC) futures contracts and options. He also announced his interest in making direct investments in cryptocurrencies and companies in the industry.

The person in charge of providing the information was the assistant manager of financial markets, Ismael Caram. This professional spoke with The capital, a newspaper in the city of Rosario, where the Matba Rofex bag originates from. The executive reported that initiatives around the world related to regulated stock market products on bitcoin are the ones that inspire this project in the Argentine market.

Caram commented that the BTC futures contract project was presented at the end of last year with the CNV, but that it still are awaiting the decision of the state body.

For Caram, the action carried out –although «incipient» – is «a step towards a new direction». He clarifies that potential clients are “qualified investors who know very well the risks and all the characteristics of this new operation.” Anyway, anyone who is a client of a stock broker in Argentina could trade this type of instrument.

In dialogue with The capital, Caram does not deny or affirm the possibility that, in the future, there may be stock products in Argentina that operate in spot mode, that is, with physical delivery of BTC. But he explains that this would imply making other developments and requesting other types of authorizations from the CNV.

Matba Rofex Index tracks bitcoin price on Argentine exchanges

What is already in operation is the Matba Rofex bitcoin index, which tracks the price of the main cryptoasset. This could be used as a benchmark for other products, including exchange-traded funds (similar to what other markets call ETFs).

The Matba Rofex bitcoin index is not a copy of existing indices in other countries, but rather it is owned by this company and use the local currency, the Argentine peso, as a reference. This is due, according to the explanation of the assistant manager of the company, that in Argentina settlements can only be made in national currency.

The executive comments that, for the preparation of this index, have been working for more than a year in conjunction with local exchanges. Name Let’sBit, ArgenBTC, Fiwind, Ripio, and SatoshiTango, among others.

Are all [las empresas] that provide us with this raw material that we take every day and, with a methodology that is publicly available on our website, we do a series of steps, we process those prices and, every minute, Matba Rofex determines a price for bitcoin.

Ismael Caram, Deputy Manager of Financial Markets at Matba Rofex.

Indeed, in the website from Matba Rofex it can be seen that the aforementioned index is already available. There it is explained that this financial indicator reflects the market price for a certain amount of BTC called “average liquidity” and expressed in Argentine pesos. In addition to the market value, the implicit cost for a purchase or sale transaction for that amount is reported, which is known as the “cost of liquidity”.

The Matba Rofex index for bitcoin is updated every one minute and is based on data provided by exchanges and brokers in Argentina. Source: matbarofex.com.ar.

The website clarifies that the Matba Rofex bitcoin index does not require, and therefore does not have, authorization from the CNV for its preparation or publication. In addition, they suggest taking into account the warnings of the Central Bank (BCRA) about investments in BTC, which were timely published by CriptoNoticias.

The governing body of the banking system in Argentina considers that cryptocurrencies – due to the volatility of their prices – are risky assets. It emphasizes the fact that they are not recognized as legal tender and warns that (as with any money) they can be used to commit illicit acts such as money laundering or terrorist financing