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FinTechs belonging to this category offer financial services using crypto currencies. This category also includes FinTechs utilising blockchain and distributed ledger technologies (DLT) upon which Bitcoin and Ethereum are based, among others. FinTechs develop and do research in this field in order to create new services – e.g. crypto currency exchange markets, wallet providers, NFTs-related services, new payment services, "smart contracts" or new clearing and settling services.
Introduction
Attitude of the country towards financial services using crypto currencies
Colombians have great interest in crypto currencies market, especially young people. Yet, there are still a lot of unanswered questions around this market and how it works.
The Colombian Finance Superintendence has stated that the transactions on virtual currencies’ platforms are anonymous. These transactions endanger the consumer protection, create money laundering, tax evasion and financial stability issues.
Existing regulation does not prevent from investing in these crypto currencies but still there are many issues surrounding this new ecosystem which are uncertain and unclear.
Colombian Government stated that it is up to each person to know and assume the risks involved in this business.
Legal affairs
Obligations and requirements to provide financial services using crypto currencies described above
There is not yet specific regulation on virtual currencies in Colombia. At the same time, there are no explicit restrictions on virtual currencies in Colombia either.
Crypto currencies are not recognized nor supported by the Colombian State nor are they part of a centralised, controlled or monitored system.
There have been certain initiatives by some congressmen to regulate virtual currencies, but these projects are still in early stages.
Colombian authorities (such as the Colombian Central Bank) have stated that crypto currencies are not legal tender, they are not money for legal purposes, they are not a currency, they are not equivalent to cash, there is no obligation to receive them as a means of payment, they are not financial assets, investment property or securities.
Additional comments regarding the legal situation for financial services using crypto currencies or what FinTech’s must be aware of in this business area
N/A.
Economic conditions
Market size for financial services using crypto currencies and biggest companies in this business area
The market for financial services using crypto currencies in our country as measured by revenues, transactions, and users is growing.
Colombia has great interest in developing a regulatory framework for virtual currencies. Yet, as of today, there is no specific regulation in place.
The sales of crypto currencies have taken place online and most websites have an international IP address, therefore no known transactions are taking place in Colombia.
For the moment, the national control bodies warn of the risks to which all those wishing to enter this business model are exposed.
Additional comments regarding the economic situation for financial services using crypto currencies or what FinTech’s must be aware of in this business area
Crypto currencies make it very easy to hide funds beyond Colombia, which is why it should be essential for the Colombian State to regulate this type of assets. It would be of great help in the fight against asset laundering and terrorist financing.