Other countries, such as Paraguay, are rushing to follow up and create laws for this unique asset class after El Salvador and the Central African Republic legalised Bitcoin as legal cash.
They are taking cryptocurrencies more seriously in Latin America, where governments are now working to implement appropriate regulations.
It has long been a popular location for bitcoin miners because of its low power costs and “crypto-friendly” climate.
On Thursday, Paraguay’s Chamber of Deputies approved a measure to regulate cryptocurrencies, despite opposition from the country’s central bank.
A majority of Paraguayans voted in favour of advancing a bill that would legalise the use of cryptocurrency in the South American country.
Deputies voted 40 to 12 in favour of enacting the revised bill draught in a special session. Accordingly, despite initial approval from both chambers, the Senate will have to re-examine the legislation before it can be submitted for the president’s signature.
In July of last year, the Paraguayan Senate approved a bill that intends to regulate the commercial use of digital assets. Licensing and supervising cryptocurrency mining companies operating inside the country are both parts of this process. No cryptocurrency would become legal tender under the proposed law.
Paraguay Could Become A Crypto Mining Mecca, Says Bill
Because of Paraguay’s cheap power prices — around five cents per kilowatt-hour — this strategy aims to turn the country into a mining centre for the rest of Latin America.
Bitcoin exchanges must now register as virtual asset service suppliers with Paraguay’s anti-money laundering agency under the country’s new law.
Virtual or crypto-asset creation and commercialization are to be regulated by this legislation in order to provide legal, financial, and fiscal security for the companies that benefit from their production or commercialization.
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