- Authorities of Banxico, the central bank of Mexico, are tight-lipped about the launch of the digital peso, which is supposed to be in circulation by 2024.
- Since the announcement of the launch of the MDBC in late 2021, the digital currency is still in its first phase.
- Mexico is recognized globally as one of the countries with the most active cryptocurrency users.
Digital currencies have been the talk of the year as almost every country has adopted the idea of creating a CBDC (Central Bank Digital Currency). A little over a year after the Bank of Mexico (Banxico) declaration to begin manufacturing and releasing its MDBC, the digital currency is still in its initial development phase.
According to local news, the Bank of Mexico (Banxico) is in its first stage, which includes fulfilling administrative, technological, and legal requirements for digital currency.
In late 2021, the government of Mexico announced its decision to initiate its national currency and have it ready for distribution by 2024. Citing the positive benefits that the digital peso could have in the country’s financial sector, the Twitter account of the President of Mexico published the country’s plan.
“The Banxico reports that by 2024 it will have its digital currency in circulation, considering these new technologies and latest generation payment infrastructure as precious options to advance financial inclusion in the country,” the tweet reads.
Though the digital currency (MDBC) development will be spearheaded by the General Directorate of Payment Systems and Market Infrastructures of Banxico, there has yet to be any news about the launch date of the digital peso.
Although the tweet mentioned that the supposed launch of the digital currency was meant to be in 2024, the Mexican authorities have yet to be evading the prediction of its launch date.
“The result of this initial phase entails the preparation of a budget that is currently being determined, and it will, in turn, allow establishing a probable date on which said MDBC (central bank digital currency) will be available,” Banxico admitted.
According to the Central Bank of Mexico (Banxico), over 10 million pesos were assigned to create digital assets in 2022. These funds disbursed by Banxico were acquired from the fees charged to financial institutions that used the Interbank Electronic Payment System (SPEI).
Three Stages of Digital Peso Development
In its explanation of the development of digital currencies, the Bank of Mexico stated that there would be three significant stages the digital peso would undergo before being released into circulation.
- Stage One
The first stage comprises the creation of the PagoCel, a mode that will permit users to make bank transfers with phone numbers or personal information.
- Stage Two
This includes the participation of Mexico’s financial institutions, which will be required to distribute a security code to enable the transfer of digital currencies via the Interbank Electronic Payment System (SPEI).
- Stage Three
The last stage is explained to be the most ambitious stage of Banxico’s development of digital currency. The central bank aims to allow people with no bank account but ownership of MDBCs to participate in using its digital currency.
Mexico’s Crypto Activity
According to Triple-A, 2.5% of Mexicans own and deal with cryptocurrencies. Estimating the number to be around 3.1 million people. The report further states that 40% of Mexican firms prefer adopting blockchain and crypto.
According to the local news, the digital currency will not be crypto-active like crypto coins such as Bitcoin (BTC) and Ethereum (ETH), and neither will it be based on any blockchain. It is expected that the MDBC will be a digital version of the country’s fiat.
The central bank’s digital currency is intended to be used similarly to the country’s paper money. Banxico, the Bank of Mexico, as a legal tender, back this. According to the Bank of Mexico governor, Victoria Rodríguez Ceja, the new payment method will assist and enhance financial inclusion in Mexico.
Bitcoin (BTC) ATM Installed in Mexico’s Senate Building
In its progression in the adoption of cryptocurrencies, Mexico welcomed its fourteenth BTC ATM inside its Senate building last year. Senator Indira Kempis, a crypto enthusiast, took to Twitter to express her excitement about the recognition and advancement of cryptocurrency in the country.
Conclusion
Since the launch of the MDBC in late 2021, the digital currency is still in its first phase, which includes determining administrative, legal, and technological requirements for creating the digital peso.
