Mexico's Central Bank President: Bitcoin should be viewed as a commodity rather than a currency

The most senior official at the Banco de Mexico (Mexico’s central bank) has said he believes it is impossible for the central bank to classify Bitcoin as a currency.

According to local media EI Economista, the governor of the Central Bank of Mexico, Agustin Carstens, said that since Bitcoin is not backed by any government or central bank, this cryptocurrency does not meet the existing definition of currency.

Instead, he continued, Bitcoin should be viewed more as a commodity because “there is no way to ensure its accounting in a financial system.”

Due to Bitcoin’s anonymity and use in cybercrime, Carstens also believes that Bitcoin should be treated as a “cybersecurity issue” and that while financial innovation should be encouraged, this should be balanced with user security.

In a lecture at ITAM, the Technological University of Mexico, the central bank governor stressed the role of regulators in financial technologies, saying that "technological developments in the financial system cannot be the result of innovation alone" but must go hand in hand with regulation by financial authorities.

He also said the Mexican government would soon propose legislation to regulate financial technologies such as cryptocurrencies.

In Mexico, financial regulation falls under the purview of the Ministry of Finance, while the central bank is responsible for monetary policy and ensuring the functioning of the financial system.

According to Coindesk’s report in 2014, the Bank of Mexico had clarified that digital currencies were not legal tender and restricted banks from using Bitcoin at the time.