Colombian Regulators Propose Crypto Regulation Bill
Two Colombian regulators have proposed another bill that would serve to regulate crypto. The bill consists of 16 provisions, including a VASP licensing system for crypto firms.
According to local media outlet El Colombiano, the bill aims to establish a legal framework that would ensure protection for crypto users and encourage more investment in the nation’s budding crypto industry.
Key Provisions of the Bill
The bill outlines a total of 16 articles that cover several crypto-related aspects including monitoring, marketing rules, education, crypto tax, as well as anti-money laundering and counter-terrorism financing measures or AML/CFT.
In addition, the bill also proposes a virtual asset service providers licensing system which crypto firms who wish to operate in the region would have to apply for. Other countries like Hong Kong, Singapore, Canada, and the UAE use VASP licenses to ensure they will abide by local regulations.
Support from Legislators
Senator Gustavo Moreno and House Representative Julián López proposed the bill to Congress on March 2, after having failed in their attempt last year.
Moreno argued that Colombia urgently needs to establish a regulatory framework for crypto exchanges and firms due to virtual asset companies in the country are operating informally which “generates uncertainty and risks for users.”
“Our bill seeks to establish clear rules of the game to generate a reliable and more attractive [crypto] ecosystem for investment with guarantees for this emerging industry,” said Rep. López.
Challenges in the Crypto Sector
According to the report, around five million Colombian users have been trading cryptocurrency. In 2024 alone, crypto transaction value has reached $6.7 billion in the country. However, the outlet has also noted that many users have also become victims of scams and pyramid schemes, and others take advantage of the unregulated crypto ecosystem to launder money.
The Colombian Financial Superintendent, Colombia’s main financial regulator, has been reportedly working on several crypto pilot projects since 2021. However, the projects have yet to produce “concrete regulatory framework.”
The lack of regulation, Moreno added, does not provide crypto services with the proper security mechanisms to protect its users and prevent the misuse of crypto assets.
It is clear that the proposed bill aims to address these challenges and provide a more secure and regulated environment for crypto users and businesses in Colombia.