Paraguay’s President Vetoes Proposed Crypto Industry Regulation

The President of Paraguay has vetoed a bill that would regulate commercial activities related to digital assets, including crypto mining.

President Mario Abdo Benítez rejected the bill in its entirety, according to an August 29 statement. Tweeter from the official Twitter account of the President of Paraguay linking to the vetoed proposal. Outlets in Spanish including The Nation and Infobae also broke the news.

Abdo’s decision to veto the bill appears to center on the condition that cryptocurrency mining be recognized as an industrial activity with an electricity tariff capped at 15% above the current industrial tariff, reported La Nación.

Fernando Silva Facetti, one of the senators who introduced the crypto bill in July 2021, strongly opposed the president’s August 30 decision. statement. For Silva, the veto “ignores the existence of this activity which operates today in the regulatory shadow”. The crypto-mining industry operates in a legal gray area and cannot access the country’s financial system, but generates jobs and resources, the senator said.

The bill will return to both chambers of Paraguay’s legislature, Infobae reported, where lawmakers can reconsider the proposal or accept the veto.

Félix Sosa, President of the National Electricity Administration of Paraguay (ANDE), told a local news station earlier this month that he would ask Abdo for a partial veto the invoice’s. He questioned whether the 15% cap would be enough to cover the costs of energy consumption, alleging that “illegal connections” in the country’s crypto mining sector had caused economic losses. To address this issue, Sosa said ANDE is seeking to have crypto mining companies pay for their electricity usage in advance with US dollars.

Senate of Paraguay passed the crypto bill one last time on July 14 before sending it to the president’s office. The bill, which had previously been approved by the country’s Chamber of Deputies in May, has faced repel from the country’s central bank on concerns, which include electricity consumption.

The bill, as submitted to the President, dealt with “the regulation of the activities of mining, marketing, intermediation, exchange, transfer, safekeeping and administration of cryptographic assets or instruments allowing the control of cryptographic assets, in order to guarantee legal, financial and tax certainty companies resulting from its generation and its commercialization.

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