Colombia’s First Bitcoin Exchange Colbitex Forced to Close Up Shop




The first Colombian Bitcoin exchange, Colbitex announced that the company was forced to stop all Bitcoin exchange operations, following a complaint by Colombian authorities. Colbitex encouraged its users to withdraw all funds from the platform while the Latin American Country's authorities review the relevant legal framework.

Colbitex, Colombia’s first Bitcoin exchange launched its platform in testnet mode on June 3, 2016. The service was working without any incidents for the past month, and on July 25 the exchange entered a beta phase, where real transactions took place.

Colbitex’s Run Lasted 8 Days

The service operated normally for the space of 8 days, with an average daily volume of 1.44 BTC. However, on August 2, the company announced the discontinuation of the website:

Dear customers, we are currently reviewing some of our processes and regulatory framework, with the hopes of continuing to provide a legally viable service. We will release further information in the next days. We implore our customers to contact our support department to process all withdrawals.

Colbitex was offering Bitcoin exchange services with local currency (The Colombian Peso COP). The suspension comes a week after Colbitex entered formal operations and it’s a major setback for the local Bitcoin ecosystem. The regulatory revision will establish a legal precedent in the government’s stance on cryptocurrencies.

Legal Status of Bitcoin in Colombia

The legal status of Bitcoin and other cryptocurrencies in Colombia isn’t properly defined. Virtual currencies (including crypto) are not recognized as legal money nor they are prohibited.

The Superintendencia Financiera de Colombia (SFC) is the Colombian government agency responsible for overseeing the financial regulation and market systems. On March 27, 2014, the SFC released a memo alerting about the dangers of using Bitcoin, the declarations express concern about the lack of regulatory framework in the crypto space.

Bitcoin is non-backed asset, it has not been recognized as a legal currency in Colombia. None of the exchanges or transactional services related to Bitcoin are properly regulated by Colombian laws.

Published by

Eduardo Gómez

Eduardo Gómez is a freelance content writer based in Venezuela, a country with a loyalist group of Bitcoin and Cryptocurrency adopter. Eduardo discovered Bitcoin in 2012 and he has been actively reporting the news in the Blockchain industry for the past year.

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