Mexico is the first country to pass an Act to Regulate Financial Technology Institutions in the world. Yes, that’s right… the first in the world. The Fintech law has attracted many controversies and was hard fought in Congress, but the future looks promising for financial technology companies and cryptocurrency in Mexico.
The Fintech Law does not deal directly with cryptocurrencies, but with those institutions that trade or utilize them. It’s not limited to cryptocurrency exchanges as most laws are. It doesn’t cover all blockchain companies like Malta. It’s not focused on ICOs like Gibraltar. Mexico’s Fintech law is unique and a great sign for the crypto industry in Latin America.
For a 10 page report on the top crypto jurisdictions, see: Where to Start a Cryptocurrency Exchange – Crypto Friendly Countries.
The Fintech Law is intended to encourage financial growth and investment in Mexico. In Mexico 13% of the population does not have physical access to banking correspondents or branches, and many residents are excluded from taking part in the traditional banking system. The adoption of the Fintech Law promises to change that. See: Fintech and Cryptocurrency Law in Mexico.
The approval of the Fintech Law is a concrete example that Mexico is thinking about the future. It will take some time for a great part of the population to start using cryptocurrencies as part of their daily life, but to have them legally be able to do it is not nothing.
Mexico is currently in the middle of an election which promises to be as brutal and unconventional as the American Elections where last november. A top presidential hopeful, Ricardo Anaya, is taking advantage of the approval of the Fintech Law and using it as part of his campaign promise for fighting corruption and improving governmental regulations.
Ricardo Anaya, presidential candidate of Por México al Frente (PAN, PRD, MC), raised four proposals with which he will be able to eradicate the country’s corruption, should he win the next elections. As always, political corruption is a hot topic on the Mexican campaign trail and all of the candidates have given speeches promising to help in its decline.
One of the most interesting proposals that Anaya gave was creating a portable virtual platform that allows permanent monitoring of public resources, in addition to incorporating blockchain technology, which will make it easier for citizens to know the allocation, use and destination of the resources that it contributes to the public treasury.
Several Mexican businesses have launched projects that use blockchain technology to ensure greater transparency in public projects. The Mexican government showed interest in Anaya’s blockchain proposal and is currently evaluating its application.
The governments of China, Russia, Switzerland, the United Kingdom, South Korea, Malta, Poland, Japan, and the United States have already started utilizing blockchain technology to increase financial security and transparency. Mexico might soon follow, which will bring positive attention to crypto and Fintech within this country of 130 million.
Blockchain technology is increasingly being used outside of cryptocurrencies and cryptocurrency exchanges. It has become more common to talk about the applications of this technology in order to streamline the management of any type of financial transactions.
Blockchain is a technology that allows the transfer of digital information with a very sophisticated coding system used in a completely secure way. It works in the same way as a book of accounting entries of a company where all the entries and exits of money are recorded. A country with major corruption issues like Mexico could greatly benefit by introducing this platform.
Along with blockchain, the other proposals to erase corruption included, creating a new system of money control, eliminating the use of cash in the three orders of government so that all payments are made through financial institutions, and having an independent anti corruption Prosecutor’s Office independent of political power.
Ricardo Anaya’s major competition in the campaign have not addressed blockchain or financial technology at all. Andres Manuel Lopez Obrador who is currently the frontrunner has outspokenly mentioned his intentions to stop corruption in the country, but hasn’t included blockchain technology as part of the solution in any of his speeches.
For example, Billions of dollars (yes, Billions with a B) are sent from the US to Mexico each year. As reported by CNN Money, “Mexicans sent home $26.1 billion from January to November 2017, according to figures released Tuesday by the central bank of Mexico. That’s the most ever recorded and better than the $24.1 billion sent in 2016 over the same period.”
Much of this is sent in cash through expensive services like Western Union. A crypto or token pegged to USD or Mexican Pesos could greatly improve these cross border transfers. The bottom line is that Mexico has the laws, the desire, and the need to be a crypto paradise.
I hope you’ve found this article on Mexico to be helpful. For more information, or for assistance in starting a business offshore, please contact us at email@example.com or call us at (619) 550-2743. We’ll be happy to assist you with a turnkey crypto solution.
For more information on starting a new international cryptocurrency exchange, see: How to Build an International Cryptocurrency Exchange.