Bank of Mexico is Considering Cryptocurrency Payment Infrastructure
Cryptocurrencies and blockchain technologies continue to become part of the mainstream for many financial organizations. As a method of securely storing, tracking, and transmitting financial information, blockchain technology is nearly unmatched. As for cryptocurrencies, companies like Ripple are making it easier than ever for financial institutions to take advantage of the high liquidity and low transaction fees associated with cryptocurrencies in order to innovate their own infrastructures for trade.
This is an incredible accomplishment for the cryptocurrency community. Although the crypto markets remain in comparative ruins following the crash earlier this year, the continuing interest of institutional and even governmental organizations in blockchain tech and cryptocurrency startups is a cause for optimism. If the traditional economic sector becomes more welcoming to cryptocurrency technology, it will become even more commonplace for major fiat investors to pump the markets full of the old money required to incentivize trust and expansion.
In the most recent of moves by major institutions to embrace cryptocurrencies, the official Bank of Mexico has expressed its interest in using virtual currencies in an effort to process electronic payments more effectively and cost efficiently. The bank made the announcement during a public consultation, in which they stated their intention to begin researching the use of virtual currencies in their payment processing infrastructure.
Cryptocurrency And The Payment Process
The major talking point of this public consultation concerned the type of steps that the agency will need to take before they can legally offer virtual currencies as a part of their international payment protocol. To this end, the speaker pointed out that they would need to establish a clear set of terms and conditions concerning the program and its new method of payments.
The slow pace of cryptocurrency acceptance in many parts of the world creates an additional set of problems for agencies looking to adopt cryptocurrency into its existing payment model. The Bank of Mexico explained that they would have to disclose to regulators in target areas about the nature of the payments being made, especially if those payments result in one of the involved parties in the country holding cryptocurrency themselves.
A Regulatory Effort
Part of the remarks by the Bank of Mexico also seem to hint that the bank is looking to provide a method of further scrutiny on companies and individuals dealing with significant amounts of cryptocurrency. During the public consultation, the spokesperson outlined that institutions involved in the cryptocurrency process will also be required to provide migratory status information before opening an account that trades with foreign entities and people.
Mexico’s Bank is not alone in this effort. Banks across the world are working hand-in-hand with leading regulators in order to respond to the influx of interest in cryptocurrencies in recent years. It is unlikely that cryptocurrencies are going to go away; new technologies continue to make it easier for blockchain technology to fit into existing technological infrastructures and maximize efficiency. But for entities like the Bank of Mexico, crypto might be the way of the financial future.