While some Latin American countries have been progressive in terms of cryptocurrencies, others have taken a step back. Mexico falls among the latter as the finance minister of the country said that crypto won’t be used in their financial system. The banks have also issued warnings in advance about cryptocurrency and its usage. Unlike El Salvador, it is not a legal currency in Mexico mentioned the authorities. Now that’s two countries (including Paraguay) off the list that El Salvador urged to adopt Bitcoin.
Warning from Mexican authorities
The statement from the authorities stated a clear idea that crypto possesses great risk. They also warned users on the use of virtual assets for the store of value, exchanges not just as an investment. The regulators also added that the banks and other financial institutions are not authorized to provide such services and hence they are maintaining a distance from them.
The volatility factor of cryptocurrency was also pointed out by the authorities. Like everyone they too pointed out the same as something negative. But what they didn’t talk about is the kind of returns that crypto has generated for the last 10 years.
Why authorities and banks don’t like crypto?
When the citizens of a country use the traditional fiat currency then the government has very strong control over them. Bitcoin, on the other hand, buys you freedom, the value of your money stays intact and you in fact get solid returns. This is what the government doesn’t want. Yes, there are some shortcomings of crypto like the lack of regulation which can be a problem in some scenarios.
For banks, the image is even more clear. The advent of crypto and the rise of investment in them means more money moves out from people’s accounts. Decreasing funds will lead to a decrease in the profitability of the banks. This is why some banks are even warning users about blocking their accounts if used for crypto transactions.
What are your thoughts on the Mexican finance minister saying that crypto is not be used in their financial system? And do you think we will have other countries adopting it as a legal tender? Let us know in the comments below. Also, if you found our content informative do like and share it with your friends.