Bitcoin in the Spotlight, Remittances Reach Record High

Remittances to Mexico hit a new record in May 2021 led by Mother's Day and the economic rebound of the US economy, indicates BANXICO. A Twitter comment by Mexican billionaire Ricardo Salinas led to a new fascination with cryptocurrencies. This and more in your weekly finance roundup. 

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• This Sunday, Mexican billionaire Ricardo Salinas, a vocal supporter of bitcoin, tweeted that Banco Azteca is actively working on accepting the cryptocurrency as payment. After Salinas’ comment went viral on social media, bitcoin’s price rose to US$34,805.19 on Monday, 8 percent up from where it stood on Friday, according to CoinDesk. But a joint statement from Mexico’s main financial institutions has put the viability and legality of this plan in question. Mexico’s Central Bank (BANXICO), the Ministry of Finance and the National Banking and Securities Commission (CNBV) published a joint statement on Monday stating that financial institutions are not authorized to enter or offer cryptocurrency transactions to the public, including deposits or any other form of custody, exchange or transmission. Late last year, Salinas revealed on his Twitter account that he has 10 percent of his liquid portfolio invested in bitcoin. 

• Mexico was the subject of 13 dumping investigations, indicates the “G20 Trade Measures” report made by the World Trade Organization (WTO). By 2020, anti-dumping investigations initiated by G20 members had increased by 60 percent, with the dumping of metal products being the most common concern. In 2019, Mexico was the subject of a total of six anti-dumping investigations but by 2020 the country was investigated seven more times. China was the subject of most anti-dumping investigations with 21. The report also studied several other trade measures and policies being implemented by G20 members and highlighted the new measures for the internet, e-commerce and other network services.

• BBVA Research announced that remittances increased 31 percent in May, reaching a new all-time high. The report mentions that this may be due to the effect of “Mother’s Day” and the increased demand for migrant labor in the US economy. Remittances have been steadily increasing for the past three consecutive months with a monthly income of more than US$ 4 billion. Despite their growth, the performance of remittances in other Latin American countries overshadows Mexico’s. During May, El Salvador and Colombia reported an increase in remittance of over 60 percent, while Guatemala and the Dominican Republic reported an increase of over 45 percent.