Paraguayan Senate approves Bitcoin Law regulating cryptocurrencies

The adoption of cryptocurrencies in Latin America is growing by leaps and bounds, with more and more governments interested in this trend.

In 2021, El Salvador became the first country in the world to officialize Bitcoin (BTC) as a legal tender.

Multiple countries are dealing with various projects to regulate this asset class.

Paraguay is one step away from approving its own Bitcoin Law to regulate cryptocurrencies throughout its territory.

The Paraguayan Senate approved the Bitcoin Law bill and added a series of amendments to the regulation that seeks to regulate the trade, custody, and mining of BTC and other cryptocurrencies throughout the country. It was confirmed by the official website of the legislative body.

The approved project, which began to be discussed in the Chamber of Deputies, frames obligations, rights, and guarantees to investors, consumers, and the State. The document reached this stage after a modification proposed by the Senate earlier in December.

As both chambers approved the legislative bill, the law is now in the hands of the Executive Branch, which has the power to approve or veto it.

The regulation is part of Paraguay’s plans to become a cryptocurrency hub boosted by its development in the hydropower industry.

THE LAW’S MAIN POINTS

The bill focuses mainly on regulating crypto mining and provides greater powers for the activity to the Ministry of Industry and Commerce (MIC), in charge of controlling the industry at the national level.

In addition, it provides powers to the National Electricity Administration (ANDE) to enable energy to mining operations, while the National Securities Commission will be in charge of commercializing assets throughout the territory.

The law stipulates that individual and corporate miners must request authorization for industrial electricity consumption and a license to operate.

As for corrections, the reform of the law frames the companies in the sector to be exempt from paying Value Added Tax (VAT).

However, according to BeIncrypto, they will be included in the income tax regime.

The law stipulates that individual and corporate miners must request authorization for industrial electricity consumption, among other points.

THE STAKEHOLDERS POSITION

In this regard, Fernando Arriola, a shareholder and the vice-president of BC Mining Paraguay, commented that if mining is recognized as another industry in the country, the panorama will change completely.

“The law would give cryptocurrencies a name and a surname. Today there is a legal loophole in mining and trading because it does not exist as an industry in front of the sub-secretariat of taxation,” Arriola mentioned.

Related to the exodus that the country glimpsed with the arrival of Chinese miners, Arriola revealed that, every week, they receive requests for quotes from Asian companies interested in coming to Paraguay.

On average, each Chinese company requires at least 100 MW to operate, translating into an investment of US$200 million.

With information from iPro Up