Paraguay Sees Opportunities In Cryptocurrencies And Will Introduce Laws To Become Regional Leader
Gresham International, which is a leading crypto law firm in the world, announced earlier this week that a proposal was submitted to the government of Paraguay to work together with them in coming up with new enhanced cryptocurrency legislation.
According to CryptoSlate, Cal Evans, who is the managing associate for Gresham international, said that the proposal was submitted after Paraguay requested the firm to give them a full crackdown on the deployment of blockchain and cryptocurrency opportunities. The government is looking for regulations to implement that will have short term and long term maximum impact.
The proposal is for the government to work with the international firm to come up with laws that will assist the country in regulating the cryptocurrency community. That is something that the firm has practiced somewhere else like Labuan, where they created new asset token laws.
During the lengthy discussions with Paraguay, it was eminent that the country is considering cryptocurrency in the long run for foreign companies in the country as well as their citizens. However, they made it clear that Paraguay is not seeking to have a digital coin as of now.
Regulating Crypto Mining Activities
A significant economic hiccup in Paraguay is that foreign investors are initiating mining activities in the country. Mining crypto is known to exploit a lot of electricity, and they seem to choose here because power is stable and cheap. After their activities and they have their crypto, they leave the country without paying any taxes to the government.
That is enabled because the current tax regulations do not cover cryptocurrency mining. Mining operations put a lot of stress on the power supply that is to help the local citizens in their everyday lives. Placing the burden of paying for the increased cost of electricity on locals is not fair. These mining firms benefit a lot, but they do not give back anything to the economy. That is the real issue Paraguay looks to curb.