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Paraguay Presents Bill to Prohibit All Bitcoin Activity

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Paraguay Presents Bill to Prohibit All Bitcoin Activity

The Senate of Paraguay entered this week, and sent to committee, a bill that seeks to ban the entire bitcoin (BTC) and cryptocurrency ecosystem in that nation on a “temporary” basis. 

According to the Legislative Information System of Paraguay, on April 3, the proposal was successfully introduced that, verbatim, “prohibits the creation, conservation, storage and commercialization of virtual assets or crypto assets, cryptocurrencies and the installation of crypto mining farms in Paraguayan territory.” 

A Legislative Move To Ban Bitcoin Mining

The project was prepared and presented by 14 Paraguayan senators , most of them members of the political party National Republican Association (ANR), which is one of the most important political groups in that South American nation. 

The bill that wants to ban all BTC-related activity was sent to three Senate committees for evaluation and deliberation.  

These are: the Legislation, Codification, Justice and Labor Commission; the Commission on Energy, Natural Resources, Population, Environment, Production and Sustainable Development; and the Commission for Sciences, Technology, Innovation and the Future.  

It is now up to the committees to ensure that the legislative process of the proposal continues without complications . If approved in the committees, the project will be returned to the Senate Plenary and, if it also receives approval there, it will be sent to the Congress of Deputies.  

Clandestine mining motivates the project

As explained in the text of the bill, a large part of the reasons why the ban on the bitcoin ecosystem in Paraguay is proposed is illegal mining.  

This is a scourge that the government of that country has openly fought against since 2023. It has even led to the confiscation of more than 4,000 ASIC miners since the beginning of the current year and even to inter-institutional collaboration to persecute and punish clandestine miners. of Bitcoin.

The Paraguayan senators pointed out the recurring electrical failures and the complaints that have been raised against illegal or clandestine mining, which has caused damages of up to 700 million guaraníes per month (more than 95,000 dollars), according to the National Electricity Administration ( ANDE).  

Likewise, they argued that there is a legal vacuum in Paraguay to regulate mining activity , recalling that the previous government of that country vetoed a bill that sought to legally frame the industry. At that time, the Paraguayan State said that mining “was not important.”  

According to the project, a ban is proposed for 180 days or until “a law that specifically regulates the activity of crypto assets or cryptocurrencies” is decreed.  Until then ANDE “guarantees the infrastructure and technical-operational resources to provide electrical energy in accordance with the real consumption demands of cryptocurrency farms without affecting the other users of Paraguay’s electrical system.” 

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Introduction The influence of cryptocurrencies on global finance is profound and continually growing. Cryptocurrencies offer innovative solutions to traditional financial