• Paraguay approves cryptocurrency regulation legislation with a vote of 40-12

  • Following the approval of Bitcoin as legal cash in El Salvador and the Central African Republic, other countries, such as Paraguay, are racing to catch up and adopt legislation for this unique asset class.

    Latin American countries are taking cryptocurrency more seriously and are working to ratify legal and other related frameworks.

    Paraguay has always been regarded as a mining sanctuary for cryptocurrency mining operations because to its low-cost power and “crypto-friendly” environment.

    Despite opposition from the country’s central bank, the Paraguayan Chamber of Deputies approved a bill to regulate cryptocurrencies on Thursday.

    In a majority vote, Paraguay advances a cryptocurrency bill.

    Deputies voted 40 to 12 in favor of passing the modified legislative draft during a special session.

    Despite the Senate’s original adoption of the law in December of last year, the Chamber of Deputies’ recent amendments will need a reconsideration of the text by the Senate before it can be submitted for presidential approval.

    The proposal, which was first introduced in the Paraguayan Senate in July of last year, seeks to regulate commercial activity using digital assets. This includes licensing and supervising bitcoin mining operations in the country. The proposed legislation makes no cryptocurrency legal tender.

    Bill wants to turn Paraguay into a crypto mining hub.

    Furthermore, the goal of this action is to make Paraguay an international mining hub due to the country’s low electricity tariffs, which are under five cents per kilowatt-hour, the lowest in Latin America.

    The new regulation forces bitcoin exchanges to register as virtual asset service providers with Paraguay’s anti-money-laundering agency.

    “The purpose of this law is to control the production activities and commercialization of virtual or crypto assets in order to give legal, financial, and fiscal security to the enterprises that profit from their production and commercialization,” according to the bill.

    Permission to Use Industrial Power

    Individual and corporate miners will have to acquire authorization for industrial electricity usage before applying for a license if the legislation becomes law.

    The proposed legislation also creates a registry for any individual or legal entity that plans to provide crypto trading or custody services to third parties, although the concept of exchange is not included.

    In 2020, over half of Fintech companies in Paraguay will have enabled digital payments and innovative financial services for businesses and consumers.

    Furthermore, 30% offered crowdfunding services and technologies to financial institutions. According to Statista data, only 8% of new businesses used cryptocurrency.

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