Four years after the publication of the Law to Regulate Financial Technology Institutionsbetter known as fintech lawand on the eve of the construction of a digital currency issued by the Bank of Mexico (Banxico), specialists and industry participants agreed that this regulatory framework, although it regulates the virtual assetsis not enough for the complete and healthy development of the ecosystem that operates these instruments.
During the Bitcoin Forum, Mexico and the Digital Economyorganized by the Legions association, different specialists gave their point of view on how the issue of cryptocurrencies given their potential to advance in the financial inclusion and therefore in the economic development of the country.
“There is a Fintech Law in Mexico which is the legal framework, but it is not enough to be able to talk about all the topics on cryptocurrencies. What do we have to do? I invite the administrative authorities to have a uniform criterion regarding the use of cryptocurrencies, to achieve this it is necessary to do an interdisciplinarity and also to open a dialogue,” he explained. Rebecca Alvarezfounder of the office loxically.
In Mexico, with the publication of the Fintech Law the topic of virtual assets became relevant in a normative manner. For the financial system, Banxico He indicated that he would not allow institutions to offer these instruments to the general public and they can only use the technology for internal matters.
At the same time, the Service tax administration (SAT) took anti-money laundering supervision for those platforms outside the Finance system and for prevention purposes money laundering Y terrorist financing.
For vanessa solisdirector of the firm consultingthe current regulatory framework that applies to cryptocurrencies does not cover the tax treatment of the operation of these instruments and although the Taxpayer Defense Office (Prodecon) has issued guidelines in this regard, that the issue is not within the law causes uncertainty.
“There are countries that, without the need to compromise the financial system, have created measures or regulatory frameworks in fiscal matters. It is important that the frameworks be adapted to the business models, but great care must be taken because any excess of the law can slow down growth,” Solis said.
Solis explained that although the Prodecon has suggested paying Income tax in the operation of these instruments, the reality is that there are several edges that must be considered for this to happen, because, for example, sometimes trading is done in other parts of the world or on centralized or decentralized platforms, for which it is impossible to talk about retention of this tax.
In her speech, Silvia Matus, Vice President of External Practice of the Mexican Institute of Public Accountants (IMCP), explained that, if the operation of cryptocurrency trading generates profits, it is necessary to pay ISR even though it is not contemplated as such in the Mexican fiscal framework.
“The authority does not care if we have income from trading or, for example, selling tables. If you have legal utilities, you have to pay,” Matus explained.
Rebeca Álvarez emphasized that, in case of contemplating adapting the regulatory framework of cryptocurrenciesit is necessary that the concepts addressed by the law be as broad as possible so that new business models can be covered, such as tokens non-expendable or other types of tokens.
“We need concepts that are as broad as possible, that are flexible and that go in accordance with business models… It is not only putting the legal framework, it is also applying it. Today we have regulators in Banxicothe National Baking and Stock Commissionthe National Commission for the Protection and Defense of Users of Financial Services and of the Secretary of Financewho need to understand business models and that is extremely important,” Álvarez said.
Processing of personal data
During the event that took place in the Senate of the Republic, Rudolph Guerrero legal representative and partner of the firm Coffee Lawhighlighted the urgency of regulating the issue of digital assets and its relationship with personal data protectionas well as themes of cyber security Y digital rights.
“A principle of homologation must be followed… The fact is to recognize what we have in the law, as well as the necessary reform paths so that those points that are part of this digital transformation are clear and generate this famous democratization of technology,” Guerrero said.
The specialist stressed that, in terms of privacy of information in digital assetsit is necessary to reform the Federal Law on Protection of Personal Dataespecially so that there is a path on what to do with the digital identity of a deceased person.
Likewise, Guerrero highlighted the need to approve a general law on cyber securityIn addition to being clear about the digital rights In the context of traceability blockchain technology and the treatment of personal information.
“What we have to take care of is privacy and recognizing the right to anonymity as part of a digital right, because if we don’t take these two figures into account, we are going to generate a greater debate about the privacy coins“Guerrero said.
Anti-money laundering regulations, the complement
In different parts of the world, such as Iceland, India Y China, cryptocurrencies is a forbidden topic; however, in others like Japan, Sweden Y The Savior these instruments have freedom in their use.
For the specialists who were at the forum, a concern of the governments that restrict the use of cryptocurrencies is due to the risk of these instruments for money laundering and financing of terrorism, which is being worked to limit it in the face of the demands of the International Financial Action Task Force.
“The issues (of cryptocurrencies) that matter at the moment are the FATF rules and the issue is cybersecurity, so that the funds are properly protected,” he explained. Etienne Luquet Fariasleader of Regulatory Affairs for Mexico of bitso.
In his speech, Jose Rodriguezdirector of Talent Land Blockchainseverely criticized the narrative that cryptocurrencies are a source of risk for money laundering, since most cases of money laundering take place in the traditional financial system.
“Sadly, Mexico has the largest money laundering cases in the history of mankind and everything has been done in regulated financial institutions… If you really FATF, authorities, central banks, all politicians are interested in combating money laundering, why have the licenses of these large money launderers not been cancelled? On the other hand, in the cryptocurrencies you have a system that is born regulated and transparent,” Rodríguez said.
For the director of Talent Land Blockchain, this narrative about the use of cryptocurrencies for money laundering causes the authorities to focus on excessive policies against companies or platforms that operate these instruments, which causes a brake on the progress that they can give. to financial inclusion.
“If we see it like in El Salvador, today more people have a Goat wallet access to bitcoin and remittances and for the first time they have access to international payments… In six months, that country managed to implement a system that has surpassed all banks together,” explained Rodríguez.
For Ricardo Lettucepartner of the firm Licona GarridoIn order to have an adequate regulatory framework for cryptocurrencies, it is necessary to take into account the government’s position in terms of monetary policy, financial security, structure for financial inclusion and even the environment.
“In Mexico we are in a process of financial inclusion, which has not been achieved so far (less than half of the population is banked), cash is still used as the main payment method, that is a very complex issue to be able to enter into the regulation of these issues,” Lechuga said.