The Paraguayan Congress approved a law to regulate cryptocurrencies. Recently, the second chamber of the Congress of that country approved a bill that regulates the mining and trading of cryptocurrencies. The bill was approved by the Chamber of Deputies with a total of 40 votes in favor and 12 against the bill. Nevertheless, the bill will return to the Senate, so the implementation of the new regulation is not yet certain.
Draft Law “That regulates the industry and commercialization of Virtual Assets – Cryptoactive”.
It goes to the Senate, with modifications. pic.twitter.com/7adN6hfP9O
– Chamber of Deputies (@DiputadosPy) May 25, 2022
Specifically, the bill establishes the bases to regulate the trade of cryptocurrencies, the custody and administration of digital assets and, in particular, the mining of Bitcoin at the industrial level. “This law is mandatory for any natural or legal person domiciled in the Republic of Paraguay that is dedicated to the activities of mining, marketing, brokerage, exchange, transfer, production, custody and/or administration of crypto assets or instruments that allow the control over crypto assets”, can be read in the letter of the project.
The application authority will be the Ministry of Industry and Commerce (MIC), which will coordinate the registration, supervision and control activities together with the National Securities Commission (which will be in charge of determining the virtual assets that can be accepted for negotiation in the securities market), the Secretariat for the Prevention of Money or Asset Laundering, the National Electricity Administration and finally the Ministry of Finance (in charge of the rules and systems for the administration of fiscal taxes).
Crypto Asset Service Providers and Crypto Asset Miners will be registered and licensed for five years, which will be coordinated by the Ministry of Industry and Commerce. Finally, in article 11 of the law, it is recognized “to cryptoactive mining as an industrial and innovative activity. This activity will benefit from all the incentive mechanisms provided for in national legislation.”.
Lastly, the cryptocurrency bill received criticism from the opposition politics. Deputy Tadeo Rojas was critical of the bill’s approval. He argued that the job opportunities offered by the mining industry are minor compared to the increase in energy consumption in Paraguay. Meanwhile, other congressmen shared a somewhat similar opinion on the bill. The high energy consumption of the mining industry has always been a point of discomfort for the sector.
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