Bitcoin

Colombia’s First Bitcoin Exchange Colbitex Forced Close Up Shop

Eduardo Gómez | August 5, 2016 | 5:42 am
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Bitcoin

Colombia’s First Bitcoin Exchange Colbitex Forced Close Up Shop

Eduardo Gómez | August 5, 2016 | 5:42 am

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.

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