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Long-term investment, as well as cross-border payments, are other catalysts.
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The exchange is confident that the new Mexican government will establish regulations.
In Mexico, three key economic factors are driving the adoption of Bitcoin (BTC) and other cryptocurrencies at an accelerated pace, the two most evident being: remittances and inflation. These are elements that not only reflect the current financial needs of many Mexicans, but also highlight a clear global trend towards digital alternatives for the use and management of money.
Jorge López Farjeat, director of business development at TruBit, which is one of the exchanges cryptocurrencies most representative of Mexico, told CriptoNoticias that the growth in the adoption of these assets in the Aztec country also responds to a “tangible need” in cross-border tradewhich is driven by trade relations with Latin America, the United States and Asia.
For López Farjeat, in Mexico, users have found in cryptocurrencies “a tool to diversify their portfolio and mitigate the volatility of their local currencies, avoiding correlations with the traditional system.”
“The increase in the use of cryptocurrencies responds to a combination of factors such as sending remittances, international payments and financial diversification. These needs have driven greater demand for information, forums and educational events, showing sustained interest in the cryptoasset industry,” said López.
Jorge López Farjeat thinks that, in Mexico, spm cryptocurrencies are seen as “a tool to diversify your portfolio.” Source: LinkedIn.
Something that the manager highlighted is that the use of cryptocurrencies in Mexico varies depending on the user profile. As he explained, people generally use them to make day-to-day payments, investments, and send money to other countries more quickly. Meanwhile, he said, companies are turning to them primarily to streamline cross-border payments and reduce operating costs.
Returning to the topic of inflation, Farjeat recognizes that this economic phenomenon has motivated many users in Latin America, and beyond just Mexico, “to seek alternative havens of value,” such as bitcoin and cryptocurrencies.
López Farjeat’s comments coincide with the fact that Mexico is currently a leading country in the adoption of cryptocurrencies worldwide. This according to the Chainalysis Adoption Index, which places Mexico in 14th place. This position places the Aztec nation above Argentinawhich is another of the bastions of Cryptocurrency adoption in Latin America and the world, as reported by CriptoNoticias.
Mexico is a leading country in the adoption of cryptocurrencies. Source: Chainalysis.
TruBit trusts Sheinbaum’s management
During the interview, the manager was asked what the TruBit company’s position was regarding the fact that Claudia Sheinbaum’s government have no interest in Bitcoin and its ecosystem. His response was clear: “we trust the government.”
“Although the regulator has not yet defined a clear framework for virtual assets, we are confident that the current government will promote comprehensive regulation for the industry, improving the operating conditions of the sector,” López stated.
“These efforts seek to establish consistent regulations adapted to the needs of the Mexican market, allowing users to operate with confidence and security,” he commented.
For the executive, it is “essential” to build bridges between the cryptocurrency industry and the government. This, “to develop a solid regulatory framework that not only responds to the needs of Mexicans, but also promotes responsible adoption of these technologies,” he explained.
López also mentioned that, although Mexico already has specific regulation for virtual assets, which is the Fintech Law, “this is still limited and leaves room for interpretations by both companies and authorities.”
Mexico’s Fintech Law, which has been in force since 2019, is responsible for regulating the use of cryptoassets by financial technology institutions that operate with this type of assets. However, This legislation has been harshly questioned by the industry itself.
Already since that year, analysts warned CriptoNoticias that the Fintech Law limited the development of cryptocurrencies. Also, that hampered development of projects linked to these assets in Mexico. This is because The regulations do not provide greater clarity about the possibilities of projects focused on cryptocurrencies.
Faced with such a situation, in 2022 the bitcoiner community of Mexico advocated for an update of the Fintech Law, considering it “short to cover the needs of the ecosystem”, as reported by this medium.
The biggest challenge: lack of education
On the other hand, Farjeat was asked what the biggest challenge is for a bitcoin and cryptocurrency exchange to be established on Mexican soil.
As he explained, The greatest difficulty is the lack of education in the population about the cryptocurrency ecosystem. And it is no small thing, namely that the absence of knowledge “opens the door to fraud and generates distrust.”
“However, we are seeing a growing effort by companies and organizations to combat these problems, increasing education and promoting trust in cryptoassets. This is a fundamental piece for the sustained adoption and growth of the market in Mexico,” he noted.
Proof of this is the recent Bitcoin training program that was carried out in the state of Pueblathrough a hackathon. Also, the alliance reached between the Autonomous University of Nayarit and the Zona Tres firm, to launch educational initiatives about the ecosystemas reported by CriptoNoticias.
Universities in Mexico have joined the education of Bitcoin and cryptocurrencies. Source: UAN.
As a way to direct efforts towards Bitcoin and cryptocurrency education, TruBit, also offers information and resources on crypto assets through an academy called TruBit Academy, as explained by the manager. In addition, the company has created alliances with international firms such as Reap and Bridge, to expand its role in the cryptocurrency ecosystem beyond Mexico.
The reasons given by Farjeat about the growing adoption of bitcoin and cryptocurrencies in Mexico show that the ecosystem is still incipient and who still has a way to go in that nation. It is a scenario that implies broader development by the community and, in turn, the participation of a Mexican State that, today, continues not to contribute much to the emerging sector.
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