Bitcoin in Mexico is now placed under the same restrictions as cash: it cannot be used for any large transactions. The measure aims at prevention of money laundering and terrorism financing.

When the new statement by the Mexican Secretariat of Finance and Public Credit (SHCP) was published, many thought it was a bitcoin ban. Indeed, the tone of the statement was harsh, as it mentioned cryptocurrencies only as a source of various risks and proclaimed that it was forbidden to pay or accept payment in “virtual goods” in the context of the article 32 of LFPIORPI.

The subsequent mention of game tokens, loyalty points and prepaid cards as falling outside the definition of dangerous “virtual goods” reminded of the similar amendments to the bitcoin ban law in Russia.

However, the statement of SHCP does not imply total bitcoin ban. In fact, the article 32 of LFPIORPI (Federal Law for the Prevention and Identification of the Operations with Resources of Illicit Origin), places restrictions on the use of cash and precious metalsin particular situations. Thus, when buying real estate in Mexico, the maximum sum one can pay in cash amounts to 8025 minimum daily salaries (currently a little more than US$38,000). When buying jewelry, artwork or a car, the threshold is 3210 minimum daily salaries (around $15,500). Adding cryptocurrency bitcoin to the article 32 simply means it is given the same status as cash.

Only selected types of purchases are included in the article 32, those which are, from the point of view of Mexican authorities, the most likely to be used for money laundering. Mexicans can still use cryptocurrencies for all other types of transactions.

Alexey Tereshchenko