Vakano, CEO of Panda Exchange, believes that government attitudes will slow investment. Alejandro Beltrán, representative of Buda, considers that this sandbox will have little impact on the sector.
In early February 2020, the Ministry of Finance of Colombia issued a decree creating a regulatory sandbox for the financial technology (FinTech) area in that country. A major factor leading to the creation of this test instance is the absence of the cryptocurrency sector, especially in the case of exchanges.
The aforementioned document makes no mention of cryptocurrencies or crypto assets, but it does mention the growth undergone by the FinTech industry. The report indicates that, of over 150 financial institutions that have sought advice, at least 76% belong to the financial technology area.
Likewise, it also presents the space as an auspicious instance for financial institutions to conduct “controlled tests of new business models, applications, processes or products that have components of technology innovation.” Cases like those of electronic payments and digital loans are mentioned, but nothing is stated about cryptocurrencies.
Uncertainty and Reluctance among Exchanges
That absence has led to expect the exclusion of the sector from this process. However, what prevails among Colombian exchanges is the uncertainty or skepticism about the expected advances for the country’s cryptocurrency industry.
Alejandro Beltrán, the Colombian representative of the exchange of Chilean origin Buda, believes that the document presented by the Ministry of Finance leaves more doubts than answers to cryptocurrency companies. Even though his inclination is towards considering that sandbox effectively excludes the sector, Beltrán claims that it is not definitively known.
The sandbox as a space for experimentation could include blockchain-based projects for developments in the financial sector, according to Beltrán. The representative of Buda said that the Colombian government’s recent moves towards blockchain research are aimed at exploring the usefulness, risks and projections of these technologies for the country.
The CEO of Panda Exchange Arley Lozano, also known as Vakano, believes that the cryptocurrency sector has been omitted by the Financial Superintendency. According to the executive, Colombia shows itself to be at the forefront of technology but maintains a position against certain advances such as Bitcoin and the other cryptocurrencies.
Vakano himself commented that the government is openly promoting blockchain whilst avoiding cryptocurrencies. In his opinion, this situation is based on the excuse that Bitcoin and other cryptocurrencies can be used to launder money. He noted that even coffee is used for that in the South American country.
On the other hand, Alejandro Beltrán assessed that the subject of cryptocurrencies is in a legal limbo. He alleges that the government does not even dare to call them “cryptocurrencies” but “crypto assets” in order not to collide with the concept of “legal tender”.
Beltrán stated that, despite this position, working groups are currently being held with the participation of various institutions from Colombia. Among them are the Bank of the Republic, the Ministry of Finance and the Superintendency of Industry and Trade. The representative of Buda added that the goal is to reach a consensus on cryptocurrencies.
By Alexander Salazar