Crypto exchange platform Colbitex has terminated its activities, after only one week of operation. The decision is caused by the uncertainty of the national legal framework in relation to cryptocurrency.

The platform is reviewing its working procedures to comply with the legal framework and hopes to continue providing services legally, the announcement on the exchange’s Facebook page says.

“We will publish the additional information in the following days. We ask our clients to contact our technical support for withdrawals.”

Currently, the platform is put offline.

Colbitex launched in the test mode on 3 June, and the beta-testing stage started on 25 July allowing to carry out real transactions buying and selling bitcoins for Colombian peso. The average daily trading volume reached only about 1.44 bitcoins, exchange commission per transaction amounted to 1%. But on 2 August, the exchange was forced to suspend its work.

The uncertain legal status of cryptocurrencies in Colombia is the main reason for the closure. Colombian peso is considered the only official currency in the country. Cryptocurrency is not recognised as legal money, and thus cannot participate in legal exchange transactions.

The rhetoric of local authorities is rather hostile: in March 2014, the national financial regulator Superintendencia Financiera de Colombia (SFC) published a memo, warning of the dangers of using bitcoin due to the lack of proper regulation.

“It [bitcoin] is not an asset equivalent to the legal currency of Colombia and is not recognised as a monetary asset in the country. Not a single platform carrying out transactions with such virtual money as bitcoin is regulated by Colombian legislation,” the statement says.

Colbitex was established by industrial engineer Roman Parra together with the Bitcoin Colombia community founder Carlos Mesa. In June, Parra declared that Colombian market has a big potential for cryptocurrency technologies development, admitting though that bitcoin is spreading slowly in Colombia comparing to the rest of Latin America.

Earlier, a network of cash machines was established in the country allowing to buy bitcoins for national currency. The terminals were installed by Panamanian cryptocurrency startup Coinapult.

Elena Platonova