Paraguay Lawmaker Launches New Bid to Regulate Bitcoin Mining
The Paraguayan Congress could be set to vote on a new bill to regulate Bitcoin (BTC) mining, despite an ongoing crackdown on illegal mining operations.
Per the Spanish-language media outlet Criptonoticias, the bill was launched by lawmaker María Constancia Benítez.
The bill appears to be pro-business, as it reportedly “highlights the capacity of the Bitcoin mining industry to promote the economic and technological development of Paraguay.”
Will Paraguay Finally Regulate Bitcoin Mining?
Benítez’s bill will need to pass the committee stage before her fellow lawmakers can vote on it.
However, it is worth noting that Benítez’s draft law is Paraguayan parliamentarians’ fourth attempt to regulate the sector.
A 2022 private member’s bill, co-authored by mining firms and their lawyers, won approval from both houses – only to be vetoed by the President.
However, the new bill proves that lawmakers remain keen to turn Paraguay into a major BTC mining player.
Benítez’s draft law notes that Bitcoin mining can help “attract foreign investments and generate new jobs.” The text of the bill reads:
“It is of fundamental importance to legislate crypto mining, as it has the potential to attract foreign and domestic investments and boost employment. [Doing so will] position Paraguay as a modernized, technological hub in the [Latin American] region.”
Diputada presenta nuevo proyecto de ley para regular la minería de #Bitcoin en Paraguay
La diputada María Constancia Benítez de Guairá (departamento donde hay presencia de mineros de #Bitcoin) presentó el proyecto de ley “QUE REGULA LA CRIPTOMINERÍA EN LA REPÚBLICA DEL… pic.twitter.com/pdQPXoEUtn
— Joaquin Morinigo 🇵🇾🏴☠️⚡️ (@criptoboi) June 4, 2024
The bill further claims that should the country regulate Bitcoin mining, it would help bring operators into “an environment of legal and economic security.”
Benítez claimed that this latter point was “essential for the sustained development” of the BTC mining sector.
Bill Proposes AML, CFT Measures
The bill seeks to impose anti-money laundering and counter-terrorism funding protocols on the industry.
It also proposes ensuring that BTC miners follow strict environmental regulations to ensure they use environmentally friendly renewables-heavy energy mixes.
The latter point will be an easy sell. Paraguay gets almost all of its power from hydroelectric power plants.
This has been a major draw for global mining firms, who have already built data centers near major dams.
Paraguay’s central bank held its benchmark interest rate unchanged for a second straight month at 6%, saying that borrowing costs are around their neutral level. https://t.co/7bKMRymXlX
— Bloomberg Markets (@markets) May 21, 2024
The dams sell miners surplus energy during rainy seasons, when rapid water flows generate more power than Paraguayan firms can typically use.
However, the bill will likely face no shortage of opposition. Power firms have blamed illegal crypto mining for disruptions to their networks.
Many miners have illegally connected their rigs to local grids. This has sparked a police crackdown, with around 3,000 Bitcoin ASIC miners seized in a recent police bust.
