Compared to many other countries, Colombia is a small fish in the cryptocurrency sea, but interest is rising. Dark clouds, however, are appearing as one cryptocurrency exchange, Buda.com, has had their accounts closed by every bank.
Bitcoin in Colombia
Similar to most countries, Colombia has no active Bitcoin regulation. That doesn’t mean this industry is completely frowned upon at this point in time. So far, the government has allowed Bitcoin to thrive, up to a certain extent. That situation is now coming to a change, albeit it seems to be due to a decision by the country’s banks. Back in February, the Colombian Financial Supervisor advised all banks that they were not authorized to interact with cryptocurrency businesses.
This is not a positive development for the Bitcoin industry in Colombia. In fact, it can be quite troublesome for any of the exchanges or wallet services operating in the country. However, this informal declaration by the Colombian Financial Supervisor has only impacted one entity so far: the Buda.com cryptocurrency exchange. So far, Bancolombia, BBVA, and Davivienda have all closed the associated accounts for Buda.com.
What Comes Next?
Even though this decision seems final, that may not be the case. The Colombian Senate has been debating as to how they regulate cryptocurrencies and blockchain technology. There seems to be genuine support among government officials for both technologies.
The chief proponent for blockchain technology and cryptocurrency appears to be Senator Antonio Navarro Wloff, who said that blockchain technology could change the lives of Colombians by “giving it use in the administration of the protection of rights, of innovators, the security of the Electoral System, the intelligent contracting, management of public services, among others, could use this technology in the future.”
It should be pointed out that this situation is not unique. Many banks across the world have denied access to cryptocurrency exchanges or not allow their customers to purchase virtual currencies via credit and debit cards. Buda.com had their access to banks shut down in Chile earlier this year, but the Chilean banks also targeted other cryptocurrency exchanges as well. A legal battle eventually overturned that decision.
South American countries stand to gain a lot from cryptocurrencies. Their global nature can counter national inflation in countries such as Colombia, Chile, Brazil, and others. In fact, the existence of cryptocurrency in some countries, such as Venezuela, is helping people actually stay alive due to harsh economic situations. As for Colombia, it’ll be interesting to see if the national government gives their approval to crypto and blockchain technology.
What do you think the Colombian banks shutting down accounts associated with Buda.com? Let us know in the comments below.
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