A bill that seeks to regulate Mexico’s nascent financial technology sector, including cryptocurrencies like Bitcoin, has cleared a major hurdle in the upper chamber of the Mexican parliament.
On Tuesday, Mexican senators approved the proposal that “seeks to promote financial stability and defend against money laundering and financing of extremists,” Reuters reported.
The bill will pave the way for a regulatory framework that will govern the operations of companies that offer alternative means of financing or investing, or issue and manage electronic funds and assets. It also seeks to regulate the operation of cryptocurrency exchanges in the country.
The fintech bill is now headed to the lower house, which is expected to vote on the measure by Dec. 15, according to the news outlet, quoting people familiar with the matter.
If approved, the bill will place domestic cryptocurrency exchanges under the ambit of the Mexican central bank, which is struggling to fit cryptocurrencies like Bitcoin within its existing regulatory framework.
Banco de Mexico Governor AugustinCarstens said in August that implementing Bitcoin should be made in tandem with regulation by the country’s financial regulators, since managing such instruments is a cybersecurity issue not only because “they are not necessarily immune to hacking,” but also because they offer “users anonymity.”
The proposed legislation, however, is still a step in the right direction for the Mexican government, which had been stubbornly holding onto its negative views on digital currencies even though the country is experiencing a growing interest in bitcoin trade. Digital exchanges, in particular, are thriving amid reports that U.S. President Donald Trump is looking at stopping undocumented Mexicans in the United States from sending money home.
Bitcoin’s underlying technology removes the need for a central exchange, but there’s no denying that the sector needs to have a regulated environment, preferably a self-regulated one, to prevent suspicious activities from taking place. The recent move by countries like the Japan, South Korea, Indonesia, United States, United Kingdom, and now, Mexico, to regulate fiat-to-crypto exchanges will help the cryptocurrency sector gain even wider mainstream acceptance—even though they still have no ability to interfere with peer-to-peer transfers.