Mexico, which amended its first crypto regulations in 2019, is one of the largest crypto-friendly countries in Latin America. At the same time, it has still some regulatory uncertainty and a lack of VASP regulations.
According to local tax authority Prodecon (1), "12% of the Mexican adult population owns some cryptocurrency, which is why the country ranks as the ninth nation with the highest rate of possession of these instruments in the world."
Mexico has a very high danger level, according to our research. It has 53,8 points (from 100) for safety in Numbeo crime rating (2). Homicide level (3) is 1,1 per 100,000 a year. Story of firearm-related death (4) 2,8 per 100,000 a year.
Based on Mondaq (5), virtual assets do not constitute legal tender in Mexico and are not currencies under the current legal framework.
According to local tax authority Prodecon (6), business transactions in crypto are allowed in the country.
There is no regulation for crypto salaries in Mexico.
The country has two primary regulators - Central Bank of Mexico (Banxico) and Comisión Nacional Bancaria y de Valores (CNBV). You may check regulators' opinions in the overview of virtual assets regulation worldwide from the Central Bank of Mexico (7).
Based on Chambers (8) Circular 4/2019 (9) and Communication № 039 (10) from Banxico, the first crypto regulation in the country was implemented in 2019.
In May 2021, Mexican legislators established some crypto regulations in Fintech law. It's called in Spanish “Ley para Regular las Instituciones de Tecnología Financiera.”
The FinTech Law allows financial institutions to operate with virtual assets. Сurrently, there are only mandatory licensing procedures for these institutions working with VA: Financial Technology Institutions (“FTIs”), Collective Financing Institutions (“CFIs”), and Electronic Payment Funds Institutions - ("EPFIs", "Institución de Fondos de Pago Electrónico" in Spanish).
No license is required for ordinary VASPs. However, some VASPs also have (11) FinTech license. For instance, Bitso, Mercado Libre and Volabit are registered as "Institución de Fondos de Pago Electrónico".
Based on PWC Tax Summaries (12) average taxes for crypto operation implied to local residents in Mexico are: 25% CGT tax, progressive PIT rate from 1.92% to 35%, and the corporate tax rate is 30%.
1)Operaciones con criptomonedas deben de pagar ISR: Prodecon
2)Crime Index by Country 2023 Mid-Year
3)List of countries by intentional homicide rate
4)List of countries by firearm-related death rate
5) Mondaq. Mexico: Virtual Currencies Comparative Guide
6) El Economista. Operaciones con criptomonedas deben de pagar ISR: Prodecon.
7) Sobre los activos virtuales, los riesgos relevantes y el posicionamiento del Banco de México.
8) Chambers and partners. Cryptocurrencies in Mexico.
9) BANCO DE MEXICO. CIRCULAR 4/2019.
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