Recently, financial institutions in Mexico attacked cryptocurrencies. Through a press release, they ensure that Bitcoin is a danger to investors. According to the publication, the risks of investing in those digital assets are great and can threaten the financial environment of the country.
The aforementioned communiqué is signed by the three most important financial institutions in the North American country. These are the Ministry of Finance and Public Credit, the Bank of Mexico and the National Banking and Securities Commission. These institutions warned that digital currencies could become an instrument for various illicit activities.
It is not the first time that centralized institutions have lashed out at cryptocurrencies. The risks and criminal activities that are allegedly attached to these assets are the favorite quotes in these attacks. However, the facts show that inflation is much riskier than any investment in digital currencies. Likewise, the almost absolute majority of illegal activities are carried out with money from national states and not with Bitcoin.
Why do Mexican financial institutions see Bitcoin as a danger?
Bitcoin is considered a danger by many financial institutions. The case that now they are the Mexicans, is not surprising. The point is that, as the defenders of Bitcoin claim, the risks of cryptocurrencies do not threaten the economic stability of people. On the contrary, they do it against the businesses of those institutions at the cost of the instability of the population.
Therefore, it is not surprising that, precisely, centralized financial institutions react negatively against cryptocurrencies. In this sense, the three mentioned Mexican authorities warn that digital currencies «they are not currencies under the current legal framework».
At the same time, they warn other private financial institutions about the provision of services on those digital assets. «They are not authorized to carry out and offer to the public operations with virtual assets, such as Bitcoin, Ether, XRP and others», They highlight. In parallel, they call «maintain a healthy distance between them and the financial system».
If this warning is ignored, these centralized entities threaten legal consequences.
Cryptocurrencies have no intrinsic value
The aforementioned financial institutions in Mexico consider Bitcoin a danger on the basis that this asset «has no intrinsic value». In addition, they ensure that no cryptocurrency has qualities that can resemble money and that they are not appropriate to be used as stores of value.
These three statements contrast with reality. For example, the value of Bitcoin is backed by the trust of its users (such as the dollar). Likewise, that value, unlike the USD, is based on the firm foundations of mathematics and not on the decisions of politicians in office.
To say that Bitcoin is a danger to society because it does not have the qualities of fulfilling money functions is also debatable. It certainly isn’t in massive use in that regard. However, its usability as a means of commercial exchange and services is growing rapidly. On the other hand, Bitcoin is in practice one of the best stores of value along with gold and silver.
Stablecoins are also not welcome
The hostility of the issuing institutions of the aforementioned statement is only hanging over Bitcoin. Also, they deny the possibility of using the stablecoins or stable coins.
It should be noted that these digital assets are generally related to external parties such as fiat or commodities. The best known of these stableconis, is the Tether (USDT), which is anchored in a 1: 1 relationship with the US dollar.
As much Bitcoin as any stablecoin, from now on, it is considered a danger by the Mexican authorities. It should be noted that this statement appears to be a response to the statement of the Mexican millionaire Ricardo Salinas, who assured that Aztec banks are preparing for the adoption of Bitcoin.