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Mexico’s central bank, Banxico, has announced through a circular note that bitcoin exchanges and other forms of cryptocurrency assets in the country are all compulsory to obtain a government permit beforehand.
According to the Diario Oficial De La Federacion (DOF) circular note published on their website, it said that any crypto exchanges and related businesses will need to provide the financial institution with a detailed business that explains its operations, commissions, business model, and know your customer (KYC) checks.
The following document, which is written in Spanish, translates as:
“The institutions of electronic payment funds must request [an] authorisation from the Bank of Mexico [Banxico] so that they can use technologies associated with any virtual assets.” The circular note also revealed that financial institutions in Mexico are not allowed to grant users the cryptocurrencies in the same day they chose to open an account. In addition to that, every user that involved in cryptocurrency trading will need to be identified.
The main objective of the financial institutions for doing so is to prevent cases like money laundering. In a related news as per local news outlet El Siglo de Torreon, businesses that involved in cryptocurrency are required to submit their applications online through a valid digital certificate. Alternatively, they can send their application by mailing to the central bank’s payments systems department, the Gerencia de Operacion y Continuidad de Negocio de los Sisteams de Pagos. Those who send their applications through mail are required to have the forms signed by “persons whose signature has been previously registered” with the organisation and included with a valid explanation on why they chose to submit this way.
Since September 11th, a number of crypto firms in the country have already applied for a permit. However, they may be required to wait at least until March 2019 for the issuance of the general provisions of the new fintech law. Businesses related to cryptocurrency that has a permit will receive an electronic payment funds account, which will enable them to operate using cryptocurrencies.
Earlier this year, CCN has previously reported that the lower house of Mexico’s legislature has approved a bill to regulate the country’s fintech sector. The objective of the bill to promote financial stability and hinder money laundering.