Banks such as Banco de Mexico have severally displayed their hesitancy in conceding that cryptocurrency is genuine. The bank gave its unfavorable opinions on Bitcoin in 2014, stating that it did notacknowledge digital currency as genuine.
In addition, they forbade any financial institution in the state to take part in transactions using the digital currency due to the dangers they thought that this kind of currency transactions was presenting to their safety.
At this period, they issued particular statements emphasizing why this decision was made in the following list:
- Bitcoins do not present legal tender since the currency is not provided by Banco de Mexico nor does it support it. Since this applies to all other states outside Mexico, it is not possible to regard it as foreign currency either.
- Bitcoins are not able to meet business responsibilities since it is not necessary for firms to accede to them.
- It is thought that Bitcoins are utilized in unlawful acts, such as money laundering, fraud and much more.
- The character of digital currencies is very unpredictable since costs are not fixed; rather, they are speculated. Therefore, cost stability is not promised.
- There is no regulation in which individuals who get bitcoins might recover their cash. This is because centralization is unavailable and there is no recognized organization that provides the asset. So, no regular manner is available to regain losses arising from using them.
In view of this, eFXto.com says that Banco de Mexico’s opinion in connection with the virtual currency has not altered a lot in 2017.
Commodity, Rather than Currency
During a Mexican University, ITAM presentation recently, Agustin Carstens said that Bitcoins need not be categorized as a genuine currency; but instead, as a commodity.
El Economista, the local newspaper indicated that the Governor supported this opinion by saying that different from its counterparts, paper currency, the digital currency lacks the support of the government or a central bank. So, it is not possible for them to be categorized as a genuine currency.
Similar to a lot of other people before him, he also talked about ‘Problems of cybersecurity,’ discussing challenges which other financial institutions experience in connection to the possible opportunity which the digital currency offers for unlawful acts.
He said that ‘nothing exists to facilitate its accounting in the industry of finance’ maybe implying the integral secrecy which utilizing bitcoins offers in the course of financial transactions.
Maybe the future holds some hope
Powerful opinions like these are being expressed; but, Banco de Mexico does not ignore the rise in market share and impact which this digital currency is experiencing.
This is especially true since a lot of investors are capitalizing on opportunities that are availed in the market of trading unpredictable cryptocurrencies.
The reason is that they are currently going through bigger price shifts because of the economic variability being experienced all over the world. In this regard, the Banco de Mexico has been analyzing endeavors of digital currencies regulation or ‘financial technologies’ such as Bitcoin.
The Governor talked about Bitcoins and offered his opinion that ‘in the financial system, technological development cannot arise from just innovation’ and said that innovation should work in collaboration with financial regulations so as to get a place in the worldwide financial market.
This indicates that while doubt exists in regard to the currency’s ‘genuineness,’ efforts are being made even now to introduce the unavoidable shift of these transactions in the greater Mexican society. They might not be regarded as genuine as paper currencies; however, Bitcoins might still present a safe area in the world of finance.