Paraguay is prepared to embrace cryptocurrency, pending legislative approval. Juan Carlos Reyes, El Salvador’s crypto regulator, asserts that foundational regulations are ready. A recent intergovernmental agreement aims to strengthen cooperation against unlicensed crypto operations, while concerns about the rise of unofficial markets highlight the urgency for timely legislation.
Paraguay is poised to incorporate cryptocurrency into its financial ecosystem, as it awaits legislative approval. Juan Carlos Reyes, the President of El Salvador’s Comisión Nacional de Activos Digitales (CNAD), notes that the country has established essential frameworks for the regulation and taxation of cryptocurrencies. According to Reyes, further action hinges upon lawmakers proposing formal legislation to facilitate this transition.
Recently, a regulatory agreement between Paraguay and El Salvador was signed, aimed at enhancing cooperation regarding cryptocurrency. This agreement focuses on combatting unlicensed crypto operations and bolstering anti-money laundering practices within Paraguay. Reyes emphasized the readiness of Paraguayan authorities to integrate this burgeoning sector effectively.
During his visit, Reyes participated in discussions with Paraguay’s Director of Taxation, who detailed the nation’s planned strategy for cryptocurrency once legislative clarity is achieved. Collaborative efforts have also been ongoing with Paraguay’s Financial Investigative Unit, sharing expertise gleaned from El Salvador’s experience in successful crypto regulation.
El Salvador’s regulatory framework for cryptocurrency is recognized globally as one of the most comprehensive, leading other nations to seek its advice. Reyes expressed concern about potential pitfalls of delayed regulation, warning that informal cryptocurrency markets could thrive unchecked, becoming unmanageable. He likened this situation to the unregulated exchange of U.S. dollars outside formal retail channels, highlighting the risks associated with a lack of oversight.
The increasing informal crypto market could mirror the complexities seen in dollar transactions, where sellers lack traceability or accountability. Reyes insists that urgent regulatory measures are necessary to mitigate the growth of unregulated cryptocurrency transactions in Paraguay.
In conclusion, Paraguay stands on the brink of integrating cryptocurrency into its financial system, contingent upon the establishment of clear legislative frameworks. With existing groundwork in supervision and taxation, the swift passage of crypto regulations is imperative to prevent the emergence of an unmanageable informal market. El Salvador’s ongoing collaboration with Paraguay underscores the potential for structured and effective regulation in the region.
Original Source: www.coindesk.com
