Victoria Rodriguez Ceja (Governor of the Bank of Mexico) stated that the CBDC (MDBC), would be “in circulation” by 2025 during an hearing before the Mexican Senate on April 21.
Rodriguez claims that the CBDC will increase financial inclusion and expand existing payment options. They expect to implement new automation mechanisms that will speed up payment processing.
“The digital currency aims to create means of payments that are aimed at financial inclusion. It expands options for fast, safe, efficient, and interoperable payments in an economy and implements complementary functionalities to existing means of payment such as automation, programmability and innovation.”
This would slow down a bit the Central Bank’s previous schedule. Cryptopotato reported on December 31, 2002 that Mexico had set 2024 as the date for launching a CBDC. However, the announcement suggests that Mexico’s CBDC could provide more than value transmission.
Banco de Mexico Is Thinking on Regulating Cryptocurrencies
Mexican President Manuel Lopez Obrador has ruled out Bitcoin and any other cryptocurrency being legal tender in Mexico. However, Mexico’s central bank wants to regulate them more.
Rodriguez stated that Banxico and other central banks were looking into the possibility of regulating cryptocurrency use in Mexico to protect citizens making transactions. These transactions are not regulated nor protected by the Bank of Mexico.
“[Several] central banks groups, including Banxico, are currently reviewing this issue [of regulation] in order to further protect those who participate in the financial system.”
Mexico will launch its own digital currency, which is very different to a cryptocurrency, but the government does not want to fall behind in regulations for the wider crypto industry. This would allow the Government to collect more taxes as it does in other countries like Brazil, Spain, and the United States.
CBDCs Are Not Cryptocurrencies
Banxico’s Governor clarified that the bank is open to future regulation of crypto-related industries. However, she stressed that cryptocurrencies are different than CBDCs due to their decentralized nature which allows citizens full control over their money.
However, she clarified that CBDCs have the advantage of being backed by the Government. CBDCs are simply a digital representation of fiat money that we all use and know.
However, she said that the new CBDC was not meant to replace traditional currency or banknotes. It would still be an alternative strategic payment method to current methods of payment.
The Bank of Mexico and the Bank of International Settlements are working together to develop their CBDC. However, it isn’t an easy road. There are still many tasks ahead. Indira Kempis, a pro-bitcoin senator, introduced a bill that would include a CBDC in the legal system. This will pave the way to a successful implementation.
Marla Brooks – Financial Analysis
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