Mexico is against cryptocurrencies

Mexico Against Cryptocurrencies

Recently the crypto market has had a bit more movement in Latin America. Colombia has become one of the countries with the largest cryptocurrency trade in the world and this has caused other nations to start considering the use of cryptocurrencies or definitely decide to recriminate it.

To this, we must add the actions taken by El Salvador. We must remember that a few days ago the bitcoin law was approved. This law makes the most important cryptocurrency in the market a legal tender in the country. This means that it has the same level of importance, safety and soon the acceptance of users, investors and tourists.

For a country like El Salvador and being Latin American to develop a regulation like this, it puts on the table conversations about cryptocurrencies for other countries. A few days ago, Maduro, the president of Venezuela commented that this had been the first country to accept cryptocurrencies legally, which is not true, but it still generated some conversation.

Among the countries that are willing to accept cryptocurrencies and those that flatly refuse, we can place Mexico among the last. Although Mexico is not the largest economic power on the continent, it is among the countries with some influence. And this time he has clearly said no to cryptocurrencies.

Mexico Cryptocurrencies

Financial authorities reject bitcoin

During last Monday, during different public appearances by representatives of Mexican financial authorities, it was commented and warned that cryptocurrencies are not legal tender. Mexico does not consider decentralized digital assets a currency that can be framed in current law.

Regarding this, they also commented that financial entities or institutions that provide similar services decide to use this type of assets to conduct business will be sanctioned. These comments were made motivated by the statements of Ricardo Salinas Pliego, who is the third richest person in Mexico.

The wealthy billionaire commented that his bank, Banco Azteca was preparing to become the first financial institution in Mexico to accept bitcoin. That a financial entity like Banco Azteca approve financial products that were related to bitcoin is an important step for the market, but the Salinas project has stopped.

As stated in a statement, the Central Bank of Mexico, the Ministry of Finance and the Banking Regulatory Body expressed as a warning that entities that offer services with digital assets, as a means of exchange, store of value or any form of inherent investment would have to face penalties.

As referenced by regulators, financial institutions in Mexico is not prepared or authorized to do business with virtual assets. These assets include Bitcoin, Ethereum, Ripple, and all similar cryptocurrencies. The authorities commented that it was best to maintain a healthy distance from this asset class to avoid legal conflicts.

Regulators warn

The position that regulators have taken in Mexico is not very different from that of other regulators in the world. The recent statement indicated that financial institutions should avoid making statements supporting the use of cryptocurrencies. It was also urged to communicate about the risks that are related to cryptocurrency operations.

If we look at the positions of other countries, such as the G7 members, they do not agree with Bitcoin, but with stable currencies and some member countries have begun to consider the development of their own stable currency. Regarding this, the regulators ratified that current Mexican law does not allow the use of stable coins and refers to the fact that these coins are linked to traditional currencies.

So now we can get used to the idea that Mexico does not intend to launch a stable currency project, at least not soon. At this point, the outlook for Mexico and cryptocurrencies is not the most encouraging. Arturo Herrera, who is the Minister of Finance of Mexico, commented during the press conference that cryptocurrencies are prohibited in the financial system. And he stressed that there is no chance that this will change in the near future.

The position that the Mexican government is taking is somewhat restrictive and leaves citizens without too many alternatives to access financial products. We have already seen how in African countries the use of cryptocurrencies has increased considerably since citizens cannot access traditional financial entities.

Although the economic and political situation of several of the countries of the African continent is not the same as that of Mexico, eventually users who cannot access financial entities will start looking for other alternatives, in addition, new investors are looking for novel options to invest and Mexico by not regulating cryptocurrencies is leaving a large number of people at risk.