The deputy considers that the application of the current regulatory sandbox is what the banks want. Consultant Juan Llanos said the industry grew fast, but regulators fell asleep at the wheel.
Mauricio Toro, from the Colombian House of Representatives, recently said that banks seek to control the use of cryptocurrencies. He believes that that activity is facing tax and legal barriers created by the State.
The deputy expressed his position to the consultant Juan Llanos and the researcher from Brussels University Andrés Chomczyk. The legislator stated that Colombian banks have enormous power, and everything is going into their hands.
Concerning regulations on cryptocurrencies, Toro believes that the banking sector is seeking to gain influence in decision-making. He expressed that they want to bank a system opposite to traditional banking.
The Use of Cryptocurrencies in Colombia
Although cryptocurrency trading is an emerging economic activity, it has gained strength in Colombia. In this sense, the legislator noted that Colombia is the second Latin American country regarding the adoption rate. In addition, he said that it is one of the first seven in the ranking in that area worldwide.
The daily reality of Colombia also reflects that growing interest in the use of crypto assets. Toro stated that 680 retailers accept payments with cryptocurrencies and considers that they should be free to conduct those operations.
Many people operate on platforms outside of Colombia, so the country misses receiving a lot of money. He believes that the State should not pose obstacles since they keep investment away and close the possibilities for choosing where and how to invest.
As a positive aspect of the crypto assets debate, Toro noted that banks want to understand how cryptocurrencies work. The message of the entry into force of the Bitcoin Law in El Salvador may reach Colombia, he said. Colombian banks Davivienda, Banco de Colombia, and Banco de Bogotá account for 65% of the market in the Central American country.
Toro Introduces a Bill to Regulate Cryptocurrencies
Besides defending cryptocurrencies and the right to access them, Toro submitted a bill to regulate them. He seeks to enable cryptocurrency exchanges with the due registration and requirements and regulated fees.
The legislator believes that they must conduct their operations freely and safely, protecting users. In that way, they could face the existing economic reality, Toro explained.
However, the deputy said that a presidential order does not allow his bill to advance. On August 3rd, 2021, Toro announced the reintroduction of his proposal before the Colombian House of Representatives. They postponed the debate for a year to wait for a decision by the Financial Superintendence of Colombia.
A regulatory sandbox currently establishes that exchanges must associate with a bank to operate, among other measures. Before its approval, banks strongly opposed that testing space, Toro said.
The legislator said that financial institutions had closed the accounts of exchanges, making their operations more difficult. He added that the application of the current sandbox is the one that banks want even though they had not thought so.
The Viewpoints of Llanos and Chomczyk
Juan Llanos and Andrés Chomczyk agreed that the regulation of cryptocurrencies is expensive but valuable. They believe that there are many scams and risks today.
Llanos said the industry grew fast, but regulators fell asleep at the wheel and were slow to see its power. Regarding El Salvador, he said that the speed of the implementation of the Bitcoin Law surprised him. However, he stressed that Bukele was brave and innovative but that there would be reactions and consequences.
Chomczyk said that the laws relating to the digital economy in Europe are increasingly complex, but their intellectual height is remarkable. As for what is happening in El Salvador, he was skeptical and said that it is necessary to wait for the consequences in practice.
By Alexander Salazar