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The Mexican CBDC will not launch until after 2024 because its development is still in its initial stages.
According to new reports, the Mexican central bank digital currency (CBDC) will likely not be ready until after 2024. Representatives from the Mexican central bank, Banxico, recently issued a statement saying the digital peso development was still in its initial phase, suggesting that a launch may take longer. Furthermore, the central bank of Mexico explained that authorities have no specific launch date for the Mexican CBDC. This development is contrary to the Mexican government’s announcement back in 2021.
As the Mexican apex bank continues to work out the kinks regarding its CBDC issuance, it issued a statement that read:
“The result of this initial phase entails the preparation of a budget that is currently being determined, and will in turn allow establishing a probable date on which said CBDC will be available.”
Local sources also stated that the general directorate of payment systems and market infrastructures is still determining requirements for the CBDC’s issuance. The division is the bank branch responsible for the development, construction, and creation of the digital peso.
It was also disclosed that more than $500,000 of Banxico funds went into developing the Mexican CBDC in 2022.
Banxico Governor Assessment of Mexican CBDC Development, Use Case
Several Mexican government officials have offered their own predictions amid the implied indefinite postponement of a CBDC launch date. For instance, Banxico Governor Victoria Rodriguez Ceja previously stated in April 2022 that the digital peso would launch in 3 years. This suggested timeline puts the CBDC development cycle at a deadline sometime in 2025 before the recent indefinite update.
At the time of her estimate, Rodriguez Ceja also established a sharp distinction between the future CBDC and other decentralized digital currencies. According to the Banxico governor, the digital peso is a valid means of exchange in the country. She also said it serves as a unit of account and a store of value – covering the three traits of money. In a nutshell, the Mexican CBDC has the backing of the country’s central bank and will be part of Mexico’s monetary base.
However, Rodriguez Ceja also maintained that cryptocurrencies remain unsupported assets in Mexico and are not legal tender in the country. As she put it, “crypto assets are unsupported assets; they are not legal tender currencies, and due to variability, they can be a risk for individuals who decide to have access to them.”
Unlike the upcoming Mexican CBDC, crypto cannot interconnect with the nation’s traditional finance system.
Banxico also expects the future digital peso to be instrumental in facilitating the financial inclusion of more people into the banking system. In a manner of speaking, the CBDC could offer another alternative means for making payments and aiding the underserved. However, Rodriguez Ceja also pointed out that the Mexican CBDC does not intend to supplant the current system.
Mexico is one of several nations across the globe in varying stages of issuing their own central bank digital currency. According to the Bank of International Settlements, 80% of the world’s central banks are currently studying CBDC solutions.