Colombia’s financial regulator, Superfinanciera, announced that Movvi and Bitpoint have been authorized to operate in the country.
Colombian users can now perform cash-in and cash-out operations using the two platforms after an evaluation by the entity’s Evaluation and Tracking Committee evaluated the pilots.
The committee was created with the purpose of regulating the operation of crypto assets in the country’s financial system.
The pilot program will run for 12 months and once it is over will require users to withdraw their Colombian Pesos (COP) or cryptocurrency while the platform deals with local regulations. Until then, users can use the platform to exchange, transfer, and operate using either COP or crypto.
Mónica Saavedra, product manager, referred to the platform’s service by stating:
“The idea is for any user who wants to buy cryptocurrency can register in MOVii and Bitpoint. In just a few minutes they will be able to send money in fiat currency using a digital wallet for the purchase and selling of crypto assets, a transaction that takes seconds.”
The country’s government has kept a friendly attitude toward crypto but has yet to establish a regulatory framework that guides users and platforms.
While many cryptos exchanges have asked the regulator to allow them to run a pilot program to operate between the boundaries of the law, none had succeeded until now.
Colombia is Focusing on Investor Safety
At this point, Colombian users who partake in the cryptocurrency market don’t count on any laws that protect their operations.
With the launch of this pilot program, regulators are taking the first steps to make this operation not only safer but also easier for the average person.
With Colombia being one of the economies with the highest crypto transaction volumes in the world, the decision comes at a time when Colombian investors demand more security in transactions.
Julian Geovo, Operations Manager for Bitpoint in Latin America, referred to the relevance of the moment by stating:
“The crypto asset market has existed in Colombia for many years. It is a big step forward to see that regulatory entities are working on creating the conditions to operate in a secure and sustainable manner for the benefit of thousands of people and companies that are already part of the crypto world.”
The Colombian government has decided to recognize digital currencies as assets instead of currencies, which has made transactions in cryptocurrencies to be the user’s responsibility.
By running pilot projects like this one, the government is making it easier for investors to understand the risks and gain access to relevant information.
Local Regulators are Keeping an Eye on Crypto
Colombia was the 7th country with the highest Bitcoin trading volume in 2020, which is a reflection of the interest locals have in the increasingly popular technology.
This interest has resulted in the Colombian government working on preparing to deal with the regulatory aspects of crypto.
Jehudi Castro, the digital transformation adviser to the Presidency of Colombia, told CoinDesk in April of 2021 that “the consequence of all this crypto activity is that we have to be careful. We can’t stand by and do nothing,”
The recent pilot is just one of the regulated testing environments the government launched since 2020, with anti-money laundering and crypto tax regulations also being issued.
Local commercial banks were also allowed back in January to partner with international cryptocurrency exchanges to offer crypto-related services.
Out of 14 applicants, 9 crypto firms were chosen to participate in the pilot, with the partnerships being Banco de Bogotá – Bitso, Banco de Bogotá – Buda, Bancolombia – Gemini, Coltefinanciera – Obsidiam, Davivienda – Binance, Powwi – Binance, Coink – Banexcoin, Movii – Panda, and Movii – Bitpoint.
While banks were permitted to facilitate cryptocurrency operations, they were not allowed to have a direct relationship with cryptocurrencies by holding them at any step of the operations.
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