Crypto Exchanges & Regulation – Top exchanges in Mexico by Coincub criteria
| Total population | 131,950,000 |
| GDP (in USD Millions) | 1,852,720 |
| Total # of universities | 1,139 |
| Leading blockchain universities | 11 |
| Jobs in blockchain | 120 |
| Bitcoin mining | 0.20% |
| CBDC stage | Research |
| Crypto received (in USD$) | - |
| Crypto sent | - |
| Bitcoin ATMs | 66 |
| Bitcoin nodes | 7 |
| Companies with bitcoin in treasury | - |
| Population % owning crypto | 9.7% |
| Crypto exchanges based in country | 2 |
| Bitcoin Interest | 52 |
| ICOs (Initial Coin Offerings) | 17 |
| ICOs energy | - |
| Fraud crypto score | - |
| Crypto financial services | 7.5/50 | |
| Web3 population adoption | 6/20 | |
| Web3 environmental impact | 0/20 | |
| Crypto trading | 8/20 | |
| Web3 talent | 6.5/30 | |
| Web3 proliferation | 7/30 |
Which continents lead the way in crypto adoptions, and which are falling behind? Do continents display individual traits and characteristics? And is China pulling down Asia in the crypto race? North America is the world’s top crypto continent North America takes the top spot as the leading crypto continent in the latest 2022 Coincub world crypto […]
Mexico’s population has long seen Bitcoin as a fast and cheap means of transferring money in a country where owning a bank account is too expensive for many. Gains from your crypto investment are taxed and punishments for avoidance can be harsh. For all that, there is no specific tax regulation, meaning crypto gains fall within the standard income tax reporting requirement – or are decided on a case-by-case basis. Mexico’s government has clear crypto regulations and guidance for banks and virtual asset services providers (VASPs) – which must be registered with its Central Bank but prefers to keep a somewhat ‘arm’s length’ approach to crypto. The country has strong figures for crypto ownership and an advanced blockchain business community but drops down the coincub rankings through a lack of advancement overall within the crypto economy
Mexico is difficult to score as whilst the population is enthusiastic about crypto to facilitate their day-to-day needs, the establishment has no strategy for advancing crypto at an institutional level. Mexico’s Central Bank publicly stated that it does not constitute a currency in Mexico, and is not to be offered or traded by Mexican-regulated financial institutions.
With so many loose ends in crypto strategic thinking, from trading and taxes to ICOs and licensing, more detailed guidelines are certainly needed. Since late 2020, exchanges and custody services must register with SAT and report to the FIU, so Mexico actually does have a working virtual-asset framework. It’s just AML-first, not innovation-first.
Mexico is a huge user of crypto, but the concept is used as a tool for many people to gain payment and exchange services – especially in a country with such a high proportion of people who do not have bank accounts. As a result, there are plenty of places to spend and also lots of ATMs, but once again, the majority of the population sees crypto as a fast reliable tool, rather than an investment asset. Bitcoin enthusiasts in Mexico can take advantage of a wide range of available services including most of the well-known international exchanges available locally along with home-based exchanges of which Bitso is one of the most popular. Platforms that are FinTech Institutions (IFPEs) or that offer virtual-asset services have to follow Banxico/CNBV provisions on same-day settlement and can only list assets Banxico allows.
As Bitcoin’s popularity and acceptance grow, cryptocurrency could fulfill several important roles in the country’s keenness to embrace financial technology generally.
Cryptocurrencies, for a long time seen as risky by the Mexican government, are now booming within the country – so much so that taxing it is high up on the Government’s list of priorities. However, there has been confusion classifying the status of a cryptocurrency and whether they are viewed as an asset or a currency. Whether your needs are for a means of exchange or as a source of investment for gain you’ll be best off talking it through with a tax expert.
Crypto is still taxed under general income / corporate rules (up to 35% for individuals, 30% for companies), but SAT now treats virtual-asset trades above ≈USD 3,500 as reportable ‘vulnerable activities’, so it’s harder to stay off the radar. The gains you make as an individual will need to be reported to the Ministry of Finance when a trading transaction is over a certain amount equivalent to $3,500.
As an intangible asset, all transactions involving crypto assets should include value-added tax, except in certain situations where some exemptions might apply. Any profit arising from the purchase and sale of crypto assets should be subject to a corporate income tax of 30%. In the case of individuals, depending on their accruable income, they can be subject to income tax of 1.92% to 35% or even be exempt in some cases.
If you are a long-term resident of Mexico you have probably been deemed a permanent resident for tax purposes. However, there is no legal restriction for a Mexican citizen or resident to participate in foreign exchanges outside Mexico. Consequently, foreign exchange does not necessarily have to comply with Mexican laws just because they have a Mexican user. If you are not a permanent resident, and your holdings are outside of Mexico you’ll fall under the required tax laws of your adopted country.
If you’re feeling generous you can gift your crypto and there isn’t a specific tax implication for doing so.
Once again, gains you make from mining are subject to tax, but as explained previously, Mexico has yet to develop a cohesive taxation strategy for crypto so you’ll be dealt with on a case-by-case basis. You’re more likely to need to make provisions for your use of energy, subject to the energy legal framework.
Most retirement and pension funds worldwide deem cryptocurrencies to be too volatile to become part of long-term retirement schemes. There is little certainty on this at present.
Crypto and digital currencies are a welcome innovation to Mexico’s large population, many of whom do not have bank accounts. Mexico’s traditional financial services, loans, credit cards, etc. are viewed as expensive when compared to setting up a crypto account and the banking establishment is looking at how to tap into this marketplace.
Mexico’s banking and insurance sector recognizes how FinTech businesses can attract a significant number of customers and have started developing innovative solutions as well as forming various types of partnerships with companies in this field.
As always it pays to do some research into the exchanges and how much support and protection they offer – or if they are insurance against unforeseen problems. In all cases you need to make a clear record of your dealings. Home-based securities may be able to provide more customer support but you need to check. There are strict fintech licensing requirements and crypto firms must report transactions over a certain amount, but tax issues have not been firmly pinned down in crypto activities and appear to be dealt with on a case-by-case basis.
Cryptocurrencies in Mexico have a wider user base, but there is no regulated market environment or designated authority to control the taxation of income from cryptocurrencies.You’ll have to disclose ID and details when opening an account with any exchange.
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