Country overview

Colombia is the third country by population in Latin America (51.52 mln) and has a rapidly growing economy with 3,3% average GDP growth (1). Since 2021, it has crypto regulations. However, while there are many complexities in the legislation, and there is no federal law defining cryptocurrencies - only bylaws.

Colombia has a high danger security level according to our rating. Jurisdiction has 39.2 points (from 100) for safety level in Numbeo crime rating (2). The homicide level (3) is 25.4 per 100,000 inhabitants a year. Level of firearm-related death (4) 20.38 per 100,000 inhabitants a year.

There needs to be a legislative gap in crypto payments regulation in Colombia. On one hand, crypto assets are not (5) considered legal tender in Colombia. On the other hand it’s possible to treat crypto payments as payments in kind or barter transaction based on data from local media Semana (6). According to this interpretation, cryptoassets as a payment method are regulated in current legislation like other payments in kind. This includes, among other things, their taxation by local tax authority (DIAN), and to determine the tax consequences that these assets may have, their value must be converted into Colombian pesos (COP) since COP is the only currency accepted

Currently, some individuals offer (7) cryptocurrencies as a payment method in Colombia. In this case, individuals can accept it as a barter transaction and declare it income to the Colombian Internal Revenue Service (DIAN).

Probably, a similar approach in cryptocurrency settlements with individuals is possible for awards, bonuses and options from foreign companies. If you have such information, please contact us.

The county's Federal Regulator is Colombia's Financial Superintendence (8).

Colombia’s government has released (9) draft rules for crypto companies that want to operate there several months after launching the South American nation’s regulatory “Sandbox” project in 2022.

The approach affirms that Colombia is working toward a future where citizens can buy crypto via their traditional banking accounts. Bancolombia—the country's largest bank—struck(10) a deal last December with New York-based exchange Gemini, allowing a limited number of clients to buy Bitcoin, Ethereum, Litecoin, or Bitcoin Cash from their accounts as part of a one-year pilot program. Nine Colombian banks are participating in the experiment, which was to last for one year.

The Financial Superintendence of Colombia approved (11) a regulation through Decree 1234 of 2020, with the objective that the entities supervised by this entity can adopt everything related to the controlled test space for financial innovation activities.

In December 2021, the Financial Information and Analysis Unit (UIAF) issued (12) Resolution 314, which requires crypto companies, which “exchange, transfer, custody or administration of virtual assets or exchange between virtual assets and fiat currencies” to register by UIAF. As of April 1, 2022, Bitcoin transactions greater than US$150 must be notified to the UIAF.

In 2022 Colombia’s parliament has reviewed regulation proposal (13) for crypto exchange similar to basic FATF approach, but based on our information this law wasn’t accepted. That’s why later in 2023 the parliament has debated a new bill proposal (14). Anyway, the lack of clear regulation of cryptocurrencies in Colombia as of October 2023 is confirmed by the speech (15) of the local Finance Minister Ricardo Bonilla, who spoke about the government's intention to issue a CBDC and create a transparent regulation for cryptocurrencies.

1) Focus Economy, Article

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)CRYPTO TAX LEGISLATION & LAW IN COLOMBIA. FAQ, article

6) Semana. ¿Se deben pagar impuestos por las transacciones en criptomonedas en Colombia? Article

7)Impuestos sobre criptomonedas en Colombia: Todo lo que se debe tener en cuenta. Taxes on cryptocurrencies in Colombia: Everything to take into account. Article

8 and 13)Superintendencia Financiera de Colombia. Financial Superintendence of Colombia. Main information

9)Colombia Advances Regulatory Framework for Local Crypto Industry. Article

10)Colombia’s Largest Bank Taps Gemini to Offer Bitcoin and Ethereum Trading to Clients. Article

11)Cryptocurrency Regulation Marches On. Article

12) Colombia addresses the problem of money laundering in virtual assets and the blockchain. Article

14) Nuevo proyecto de ley que busca regular las criptomonedas en Colombia se presentará en Julio. Article

15)Colombia Unveils Blueprint for Central Bank Digital Currency (CBDC) and Crypto Regulatory Framework. Article

16)PWC Tax Summaries