Although Colombia is the fourth country in Latin America with the highest trading volume of crypto assets and 32 in the world, There are still no rules that regulate the transaction of these products, although there are initiatives to control the platforms through which they are exchanged.
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The lack of regulation and warnings about the risks of putting resources into assets that do not have an authority that requires the return of the investment in case of loss has generated uncertainty among users and companies in the sector, as well as funds with interest in investing in local projects.
Roberto Borrás, former Financial Superintendent, and partner at the international law firm Garrigues explains that “Through various legislative initiatives, attempts have been made to adopt a regulatory regime for cryptoassets, without any of the bills presented having completed their processing in the Congress of the Republic. However, it has been announced that the Ministry of Finance, the Financial Superintendency, the Financial Regulation Unit and the Bank of the Republic are working on a project aimed at regulating exchange platforms and other aspects of said digital assets.
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A few days ago, Ricardo Bonilla, Minister of Finance, once again put the issue of cryptoasset regulation on the table and assured that the country is making progress in developing a regulatory framework for these operations. This framework will be added to existing secondary regulations for service providers with virtual assets, which generate reporting and compliance obligations for these activities.
For his part, Gabriel Santos, president of Colombia Fintech, said that “The authorization that the United States Securities and Exchange Commission (SEC) gave for the inclusion and trading of shares of Bitcoin exchange-traded products (ETF) is a fact that should allow the regulation of cryptocurrencies in Colombia.”
The Bank of the Republic, has clarified that cryptocurrencies are not considered legal tender in the country, That is, they are not supported or regulated by the State, and do not have official recognition as a means of payment and have warned about the volatility and risks associated with investing in these products.
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The Financial Superintendence has said that the supervised entities are not authorized to custody, invest, intermediate or manage operations with cryptocurrencies and warns of the risks of fraud and the lack of consumer protection in that market.
For its part, the Financial Information and Analysis Unit has placed emphasis on the prevention of money laundering and the financing of terrorism in relation to cryptocurrencies. In 2021, it issued External Circular 18, which requires reporters to report on suspicious operations related to the use of virtual assets, in an effort to increase transparency and control.
Thus, the regulation of cryptocurrencies in Colombia is in an incipient phase, with several government entities issuing guidelines and alerts to protect users. Although there is still no specific legislation that fully regulate the use and marketing of cryptocurrencies, Regulatory efforts are expected to move towards the creation of a clearer legal framework.
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According to the Global Crypto Adoption Index 2023 ranking, in Colombia there were $800 billion in monthly transactions in 2023 with these products.
In May, Bancolombia launched Wenia, a cryptoasset platform for carrying out transactions from Android and iOS devices. Banco Itaú announced that its clients can now buy Bitcoin and Ether through its investment platform called Íon.
Cristóbal Pereira, from the Blockchain Summit Latam, said that “regulation must encourage development and innovation in the cryptocurrency industry. “This will allow more people to access the benefits of this technology, ensuring that there are clear tools and processes for the safe use of trusted platforms.”
Mauricio Tovar, founder of TruWeb3, said that “Regulations must have a certain balance, they should not be so rigid as to restrict the sector, but clear to avoid gaps and guarantee safety. This is essential for large companies that want to develop projects.”
The eighth version of the Blockchain Summit Latam 2024 will be held in Bogotá between August 14 and 16, an event that seeks to promote the future of the crypto, blockchain and web3 industry in Latin America.
Several speakers from various industry sectors will discuss regulation in the cryptocurrency ecosystem and Blockchain technology.
The program covers various areas, including financial services, logistics, real estate, international trade. The TruWeb3 firm is one of the organizers.
HOLMAN RODRÍGUEZ MARTÍNEZ
BRIEFCASE
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