Earlier this month, the Bank of Mexico (Banxico) published a circular[1], wherein it laid out its plan to issue permits to bitcoin exchange platforms and other crypto-related businesses operating in the country.
Banxico’s circular stated that to get the right permits, crypto-based businesses in the country would be required to provide detailed business plans and company profiles.
Each profile will have to contain various aspects of how the business operates including its business model, transaction fees and know-your-customer (KYC) security measures.
Per the circular, the principal objective of the regulator is to curb the occurrence of crypto-based money laundering. To achieve this, it has implemented certain safeguards that will keep the operations of crypto businesses away from the traditional financial sector.
A report[2] by local news outlet El Siglo de Torreón clarified that any business looking to submit their application for a permit online will need to do so with a digital certificate, which helps provide confidentiality.
For those who don’t have these certificates, the filing will have to be mailed to the Gerencia de Operación y Continuidad de Negocio de los Sistemas de Pagos, Banxico’s payment systems division.
Application for this permit has been open since September 2018, although companies might now have to wait until March 2020 before the new law will come into effect.
A Regulatory Roadblock
The central bank has also prohibited any regulated financial institution from transacting with crypto-related businesses.
In an op-ed[3] published by advocacy group Coin Center, written by Executive Director Jerry Brito and Research Director Peter Van Valkenburgh, the authors noted that the actions of Banxico are draconian, effectively putting the local crypto market to the sword.
The post states:
“Cryptocurrency exchanges dealing in fiat currency need access to
