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Case study: meXBT, Mexico This case study demonstrates how governments can promote the development of the digital currencies market by implementing adequate regulation. meXBT is a platform for trading digital currencies such as bitcoin and litecoin. One of its objectives is to cater to the remittances market, particularly between Mexico and the United States. The company is based in Mexico and provides services in Latin America. mexBT seeks to help the \"un-banked\" population move money using mobile phones. The company partners with cash-payment processors to facilitate deposits and withdrawals.The company required funding to develop its trading platform, so it applied to receive support from Seedcoin, which invested BTC 250 in mexBT in 2014116. At the time, this amount corresponded to about USD 150 000 (after bitcoin’s precipitate drop in value the next year, that value was closer to USD 62 000)117. The equity share Seedcoin received for its investment was not disclosed, but it typically varies between 10 and 20 per cent118. meXBT claimed that the support from Seedcoin was very important not only for funding but also from a mentoring perspective, due to the incubator’s expert knowledge of the bitcoin market. In November 2014, mexBT launched its trading platform. The investment risk for Seedcoin was very high, because meXBT was a start-up when it received the funding support. The currency’s volatility added to the risk by making the value of the funding amount uncertain. In March 2015, the UK government began regulating bitcoin exchanges to prevent them from being used for money laundering, an initiative applauded by the UK Digital Currency Association as being very important to increase the adoption of digital currencies.1.6.4 Charity or non-profit institutions Some charity or non-profit institutions are involved in financing businesses. Their investments normally are related to the mission of the institution, and businesses eligible for this type of financing usually are seen as promoters of economic or social development. Start-up companies are typically the beneficiaries of this type of support.For entrepreneurs, this funding approach usually means not having to give up equity in their companies to investors. The amounts made available through such funding can vary significantly. Fundación Bavaria in Colombia claims to have financially supported 388 start-ups with a total of USD 8 million119. This support represents an average of USD 22 000 per business. In the UK, Nesta, an innovation charity, supports businesses seeking first-phase investments of between GBP 150 000 (USD 235 379) and GBP 1 million120 (USD 1.57 million).The investment risk is usually high, because the beneficiaries typically are start-ups, but the goal usually isn’t getting a return on investment as much as achieving expected socio-economic gains through the start-ups. Often, this kind of funding involves local non-profits supporting the needs of local entrepreneurs, giving them a foundation to develop and to become attractive to other investors. These funding initiatives may be spurred by financial regulations. For example, a government might provide tax breaks to institutions that support businesses or projects with a positive social or economic impact.36 Trends in Telecommunication Reform 2016 Box 1.18: Key lessons: meXBT, Mexico, 2014 • mexBT received funding in bitcoin from Seedcoin, an incubator, to develop a trading platform. Seedcoin’s strong knowledge of bitcoin benefited mexBT. In very nascent markets, it is important to select partners that have a strong market knowledge, as this can determine the success of the start-up.• Governments can promote the development of the digital currencies market by implementing adequate regulation. This framework should protect consumers and increase their trust and co