Mexico Proposes Legislation to Tame Bitcoin

Mexican politicians join the growing club of government regulators wishing to get a handle on bitcoin and financial technology.

Also read: Bank of Mexico Rejects ‘Virtual Currency’ as Legal Classification for Bitcoin.

Sheky Scoops Mexico’s Press

Mexican financial journalists were taken off guard when a Reuters story by Sheky Espejo claimed to have seen pending legislation only whispered about for months.

If government officials have their way, it appears they’re ready to intervene in Mexico’s thriving markets, cryptocurrencies generally, bitcoin in particular, and financial technology (fintech).

Sheky Espejo

Latin America’s second largest economy was rocked recently by a hurricane and a devastating earthquake, the latter of which has probably slowed the pending legislative pace.

Half of Mexico’s population remains un-banked, essentially without recourse to capital and credit.

The draft seen by Mr. Espejo “proposes measures to regulate companies operating with virtual currencies like bitcoin, although it does not provide much detail. The central bank would be tasked with refereeing such operations, the document says.”

Legislation is a response to Mexico’s financial technology boom. More than a few sources believe the country to be the region’s fintech growth leader.

“We went from less than 50 (companies) in 2015,” an anonymous source is quoted, “to 158 in 2016, and we already have over 240 this year.”

The Power of Remittances

Electronic transfers of money, and so the financial technology scaffolding them, regardless of their fiat or commodity status, are lifebloods of the country’s economy.

More Mexican migrants “as a percentage of the total Mexican migrant population are sending money,” noted a report from Leadership for the Americas (LftA).

For the region as a whole, expats sending back money in 2016, the last year for which numbers are known, “surpassed US $70 billion. In the 20 countries for which there is data available, the flow reached US $69 billion,” LftA concluded.

Thirty Read More Here