A bill aimed at regulating the behavior and operation of crypto exchanges recently received approval in its first discussion in the Congress of Colombia. This is the first step that the country has taken for bringing clarity to this matter. Mauricio Toro, one of the bill’s creators said that the purpose of the legislation is for protecting people from the Ponzi schemes that have become rampant in the crypto world, thereby offering them security.
A great number of countries in Latin America are becoming aware of the crypto space, as their territories have seen the influence and growth of these digital assets and crypto-related companies. One of these is Colombia and this has prompted its government to speed up the process of regulation of crypto exchanges for providing clarity to the duties and responsibilities of these firms.
The Road to Crypto Regulation
Therefore, steps have been taken by the Columbian Congress for approving a bill that can give greater clarity as well as security to crypto exchanges that are operating in the country. Hailing from the Green Party, Mauricio Toro talked about the new bill on social media. Toro stated that they need to take things forward in Colombia where regulation is concerned.
He stated that crypto is a multi-million dollar industry and is legal, so they need to create opportunities and jobs in order to provide peace of mind to people so they can buy their assets safely. Toro asserted that the purpose of the bill was safeguarding customers and users of crypto exchanges, so they do not fall into the trap of any Ponzi schemes.
A Long Way to Go
While the legislation may eventually have a positive impact on the Colombian crypto industry, it should be noted that it has only had its first reading and there are three more stages it has to go through before it is presented and implemented as a law. Considering the political situation of Colombia, this could take a lot longer than anticipated. The country is currently halfway through its election cycle and its elections are coming soon.
If the bill receives approval as it is now, it would mean that crypto exchanges operating in the country would have to register themselves for offering their services. In addition, they would also be required to disclose the possible risks, benefits as well as profits their users can enjoy. In addition, the banks in the country would also play a role in safeguarding users in the crypto industry. They will protect people from falling for pyramid scams and Ponzi schemes by offering accounts to users of crypto exchanges directly in fiat currencies.
Other Colombian institutions are also taking steps for regulating the interaction between exchanges and customers. The UIAF, the country’s money-laundering watchdog, had announced back in April that people would have to use an online system for reporting their crypto transactions. But, the implementation of the resolution was postponed by the organization for the time being.