Colombia’s first ever commercial bank, Banco de Bogotá, which was established in 1870, announced earlier during the week on Monday, that they would be trialing cryptocurrency services via a pilot program set up by the country’s financial regulators, Superintendencia Financiera de Colombia (SFC).

The sandbox project will allow the bank to explore the business model and the risks associated with the management of crypto assets.

In this test, the financial institution a group of clients will be chosen by the Bank to carry out transactions with specific limits.

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Customers who participate in this test will be able to make cash-in (deposit) and cash-out (withdrawal) operations of crypto assets from the digital channels of Banco de Bogotá which are Mobile Banking and Virtual Banking.

This enables the client, so that after a process of selling cryptocurrencies and converting them to Colombian pesos, they can send them to their accounts in the Bank and make use of the channels available for withdrawal. It also enables a process of buying cryptocurrencies in their value in pesos from their accounts in the Bank.

As this is a pilot test, Banco de Bogotá has the responsibility of controlling the deposit and withdrawal operations of crypto assets that are developed.

This is within the framework established by regulatory entities to guarantee the safety and integrity of operations.

Vice President of Technology at Banco de Bogotá, Oscar Bernal Quintero, elucidated on the process,

“Our participation in the Sandbox of the Financial Superintendency adds to the initiatives that we have been developing in our digital transformation process, where we constantly explore technological innovations seeking to develop new products and services in an agile, safe and reliable environment.

“One of our great motivations is to be an active part of the transformation of the country and we consider it valuable to participate in the construction of the possible regulation that would enable the exchange of crypto assets within the Colombian regulatory framework.”

Colombia is one the nations to have traded Bitcoin the most and this development starkly contrasts the decision of Nigeria’s financial regulators, CBN, to outrightly prohibit financial institutions and banks from dealing in crypto trading, as Nigeria was the world’s second largest country behind the US in crypto trading volume, before the ban.

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