Orionx Exchange Loses Chilean Supreme Court Appeal
The Supreme Court of Chile has rejected the appeal of cryptocurrency exchange Orionx’s, which simply means the company’s account with BancoEstado a state-owned bank won’t be reopened.
In March this year, BancoEstado informed Orionx that it would soon close the exchange’s account. The company responded by filing an appeal against the bank, along with other two exchanges CryptoMKT and Buda, in April. Santiago’s Court of Appeals, which heard the case in July, judged the bank’s action to be “arbitrary and illegal,” thereby infringing on a constitutional right to legal equality before the law. As a result, the court made a verdict that Orionx’s account should be reinstated.
However, the Supreme Court failed to agree with the lower court’s decision. The Supreme court noted that BancoEstado’s closure of Orionx’s account was not arbitrary nor illegal. The court further stated that because cryptocurrencies such as Ether, Ripple, and Litecoin are not physically manifested, they don’t possess intrinsic value, and they are not backed by any government, the bank could not fully know about Orionx’s financial activities, limiting the bank’s ability to ensure compliance.
The final ruling of the court states that “It is precisely this impossibility of knowledge and of fulfilling the duties that weigh on the bank, which gives support to the decision to close the bank account of the plaintiff [Orionx].”
The Supreme court also maintains that it wants to prevent the possible exploitation of BancoEstado, as cryptocurrency has been linked to terrorist financing and money laundering, among other shady activities.
Therefore, Orionx’s account will remain closed, but Guillermo Torrealba, the co-founder and CEO of the crypto exchange Buda, reassured the crypto community via Twitter that the Supreme Court’s ruling only affects Orionx, not his company. The cases are separate.