Cryptocurrencies aren’t Legal Tender, Beware of Risks: Mexican Authorities

On Monday, the financial authorities of Mexico revealed that cryptocurrencies are not legal tender in the city and hence, they are not considered currencies under the present financial laws. The Mexican financial authorities warned that the institutions that are involved with them are subject to sanctions.

Mexican Authorities Warns About Cryptocurrencies

Well, this statement from the finance ministry, the Bank of Mexico, and the banking regulator come after the statement of Ricardo Salinas Pliego, a Mexican billionaire. 

Ricardo Salinas Pliego said on Sunday that Banco Azteca, his banking business may start using Bitcoin which would eventually make the bank the first bank to initiate cryptocurrency acceptance in the country.

Earlier this month, we witnessed the financial authorities of El Salvador claiming that they accept Bitcoin as a legal tender in the country, which made it the first in the world to do so.

As per the official statement by the authorities, it said:

“The financial authorities reiterate their warnings … on the risks inherent in the use of so-called ‘virtual assets’ as a means of exchange, as a store of value, or as another form of investment. The country’s financial institutions are not authorized to carry out and offer to the public operations with virtual assets, such as Bitcoin, Ether, XRP, and others in order to maintain a healthy distance between them and the financial system.”

Arturo Herrera on The Current Rules

As revealed in a news conference by the finance minister, Arturo Herrera, under the current rules, it should be noted that cryptocurrencies are banned from being utilized in the Mexican financial system.

In addition to this, it can be observed that the ban will most likely not alter in the near term. 

The statement added:

“Cryptocurrencies tend to be volatile and speculative assets and while they can be traded, they do not serve the same function as money, since their acceptance as a means of payment is limited and they are not a good reserve or value reference.”