Crypto regulations in Colombia are put on the back burner

Contxto – In human behavior, often when something is undesirable but a person does not wish to discard it entirely, they delay. This logic may also apply when it comes to cryptocurrency regulation in Colombia. 

A law that addresses cryptocurrency regulation was to be presented and discussed among legislators this week. However, a senator—one Horacio Serpa—, who was supposed to bring the law in for debating, called for a rain check.

Serpa stated he’s waiting for additional information from the Financial Superintendence of Colombia (SFC). FYI, the SFC has shown it’s no BFF of crypto-enthusiasts.

Moreover, it’s not the first time the discussion is delayed. Regulators were supposed to address the topic last Saturday (6).

And time isn’t on cryptocurrencies’ side. The current legislative session ends on June 20.

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Cryptocurrency regulations in Colombia

The Colombian government—particularly the SFC—has historically displayed disdain for digital assets:

2014: Officials disclosed notices that stated that regulated financial institutions are not authorized to possess, invest, or basically touch cryptocurrencies.

2016: Colbitex, a Colombian crypto exchange emerged and shut down within a week citing authorities obstructing its operations.

2018: The SFC published a series of notices that warned of the risks of cryptotrade. This scared banks into closing accounts linked to cryptocurrencies and proved detrimental for cryptocurrency startup, Buda.com.

• Related article: Cryptotrade through Colombian Buda.com still possible through Tpaga

Now with this recent delay in congress and Senator Horacio Serpa waiting for the SFC to have its say… Things don’t bode well for cryptocurrency regulation.

The biggest risk entailed in not laying down any legal framework is that it exposes users to crimes like fraud. Moreover, it can also lead to money laundering. But authorities have shrugged these threats off and argued that people will assume those risks when toying with something that isn’t legal.

So the question remains: Will cryptocurrency regulation in Colombia ever have its day in congress?

Related articles: Tech and startups from Colombia!

-ML