The crypto community in Mexico is largely against the country’s recently implemented regulations on digital assets.
According to Sebastian Checa, CEO of the Isbit crypto exchange, the new law is a disaster and its adverse effects transcend the crypto space. Chace also added that the rules are an indicator of the bank of Mexico’s ignorance about virtual currencies.
The Bank of Mexico recently published a circular outlining the regulations that it plans to impose on fintech companies that deal with cryptocurrencies. The laws require fintech firms to protect their clients from involving themselves with complicated and extremely volatile digital assets. As per Sebastian Checa, the rules are in a way barring companies from offering crypto-related services to their customers.
In March 2018, the Mexican Congress passed a law to regulated fintech companies. This gave the Bank of Mexico the mandate of choosing which digital currencies would be legal in the country.
The majority of crypto investors and businesses were confident that the then-impending crypto regulations would be favorable.
Differing Opinions and Ambiguity
Tommy Alvarez, the CEO of the Voltabit exchange, said that the proposed regulations are basically preventing fintech firms from offering crypto assets to their clients.
Contrarily, the Bitso exchange appeared to be in support of the rules, saying theta the central bank only wants to ensure that cryptos are exclusively used for internal operations in fintech companies.
On his part, Alvarez believes that the law is paradoxical because it forces crypto trading platforms to register as fintech companies. He added that even after acquiring the license, the exchanges would still be barred from listing digital assets. This means that it would be illegal to run an exchange platform if the law were to be passed.
Additionally, Checa noted that some parts of the circular are ambiguous. He blamed this on the rushed drafting of the regulations, as well as a lack of analysis and incompetence.
For example, he mentioned that forex companies and financial institutions don’t Cnut as ‘consumers’ to them. Therefore, Isbit will not shut down because such entities are allowed to deal in cryptocurrencies by the law previously passed by Congress.
Adverse Impacts on Economy
That said, Checa acknowledges that Isbit has to appeal against the central van’s proposed laws if they want to serve retail crypto investors. Sebastian concluded by stressing that the implementation of the regulations will have a negative impact on the Mexican economy which is currently budding.