Andora passes digital assets trade greenlighting blockchain and Bitcoin
Andora passes digital assets trade greenlighting blockchain and Bitcoin
Digital currencies and cryptos are not authorized as legal tender in Andorra
By Shashank Bhardwaj
Image: Shutterstock
Andorra, a small European nation between France and Spain, is a glimpse of progress. The Digital Assets Act, which establishes a legal framework for virtual currencies and blockchain technology, recently received approval from the General Council of Andorra.
The Act is divided into two parts. The first part involves the development of “programmable digital sovereign money.” The Andorran citizens can trade with this digital money in a closed system. To put it simply, this part of the law points towards a possible deployment of a CBDC system in Andorra in the near future.
The second part of the law deals with regulations around distributed ledger and blockchain technologies. The law also refers to crypto and other digital assets as financial instruments. According to Paul (who chose not to use his last name), the new rule could bring in new customers, including the CEO of local Bitcoin company 21Million. He stated: “The result they are trying to achieve is to attract new businesses to locate in the country by offering some legal clarifications that make it easier and more transparent. They see this as a way to attract talent and entrepreneurs to the new the economy.”
Crypto-assets and other digital currencies are not recognized as legal tender in Andorra, and the Digital Assets Act does not propose any new provisions for methods of exchange via these assets. This privilege is only granted to the Euro, the European Central Bank’s preferred currency. Despite this, Paul, a fervent Bitcoiner, continues to argue for the acceptance of Bitcoin (BTC) in Andorra.
The Digital Assets Act is a step towards “making crypto a daily reality,” according to national newspaper Diari d’Andorra. Paul argued that the steps taken by the Andorran government regarding digital assets determine how “crypto-friendly” something will be from a commercial perspective.
Josselin Tonnellier, the co-founder of StackinSat, believed that crypto, blockchain, non-fungible tokens and Bitcoin are still not very well understood in the country. Regarding Andorra, he said: “Andorra is very attractive for entrepreneurs thanks to its low taxes, but Switzerland has a good lead in promoting the development of activities around Bitcoin and cryptocurrencies in general. This may change in the coming years thanks to this legislative text which frames Bitcoin and blockchain activities.”
Andorra’s Minister of Economy and Business, Jordi Gallardo, said in an interview in May that Andorra was focused on blockchain as one of the most important areas of financing. While it cannot be said with certainty whether the minister was talking about Bitcoin or DLT in general. The Andorran government’s recently approved Digital Assets Act also does not clearly specify which digital holdings it will apply to. However, the movement, which is financially motivated, could include crypto and blockchain-based companies to diversify the Andorran financial system.
Shashank is the founder of yMedia. He ventured into crypto in 2013 and is an ETH maximalist. Twitter: @bhardwajshash
