Since September 17th, Volabit will disconnect its wallets in Mexican pesos. The Fintech Law prohibits FTIs from offering cryptocurrency operations to their users.
Cryptocurrency exchange houses operating in Mexico are modifying their operations processes due to the Law to Regulate Financial Technology Institutions (FTIs), or Fintech Law, together with the provisions issued by the Bank of Mexico (Banxico).
The rules issued by Banxico prohibit FTIs or credit institutions (CIs) from offering the general public operations with digital assets. However, they allow unregulated cryptocurrency exchange houses to continue operating.
Regarding the Fintech Law, it considers the issuance of a license for creating digital assets that covers platforms and services that operate with the national currency and allow the issuance of internal and external payments, which is forcing these companies to make operational changes.
In this sense, the Mexican exchange houses Volabit and Vexbi have recently announced on their official blog that, since September 17th, their wallets in Mexican pesos will be disconnected from their platforms. This is a “transitory measure” derived from the regulation concerning cryptocurrency operations that is being implemented in the Aztec country.
The statement explains that the platforms will continue to operate almost as usual. However, the difference is that deposits in Mexican pesos will automatically be converted to USD Coin, an ERC-20 token supported by the US dollar, which can be used to buy Bitcoin, Litecoin and Ripple.
With regard to the measure announced by the exchange houses, Tomás Alvarez Melis, director of Volabit, said that the Fintech Law, together with the provisions issued by Banxico, prohibits FTIs from offering cryptocurrency operations to their users. Additionally, they restrict operations with wallets in pesos, thus leaving two possible options for exchange houses.
Álvarez explained that some exchange houses such as Bitso are adjusting to the first option, whilst others such as Volabit and Vexbi are adjusting to the second. He added that these changes only affect the way in which companies trading with cryptocurrencies operate and have no relevance to users.
PayPal updated its legal agreements for its customer portfolio in Mexico and announced that, since September 25th, it will eliminate the possibility to have a balance stored in the accounts and access it when it is wanted. Instead, it will pass the bank accounts to an automatic transfer system. Instead of storing the money, it will be automatically deposited into the user’s bank account.
With this function, a fee will also be charged for each currency conversion, which will be updated to make payments, according to the new terms and conditions.
Next September 9th is the deadline established by the Fintech Law for financial technology platforms to request their authorization before the National Banking and Securities Commission (CNBV) to operate within the scope of the law.
Moreover, since September 10th, Mexican cryptocurrency exchange houses must report, before the Secretariat of Finance and Public Credit (SHCP), operations with cryptocurrencies that exceed 54,000 Mexican pesos (approximately USD 2,800).
The regulations are applied according to the Federal Law for the Prevention and Identification of Operations with Resources of Illicit Origin, in force in that country.
According to data from FinTech Mexico, in the country there are 400 financial technology platforms in different sectors, such as payments, loans, investments and insurance.
By Willmen Blanco