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The law on cryptocurrency and mining that the Paraguayan Congress passed in June was finally shelved on December 5. The document, which sought to bring order to crypto mining and exchange activities in Paraguay, was eventually shelved after it failed to garner the necessary votes to override the presidential veto it received.
The Paraguayan cryptocurrency law introduced in Congress in 2021 was ultimately shelved after failing to receive the support it needed in the Chamber of Deputies. The project, which was vetoed in September by President Mario Abdo, failed to gather the votes needed to override that veto.
The veto had previously been rejected by the Paraguayan Senate, which aimed to approve and pass the law without presidential support. The veto had the support of the Commission for Industry, Commerce, Tourism and Cooperatives; while the commissions for economic and financial affairs and the fight against drug trafficking, related and serious illegal activities rejected the proposal.
Some deputies questioned the veto, saying that the cryptocurrency issue needs to be studied and regulated because of its importance. In this way, deputy Sebastian Garcia criticized this result, stating that with this move, the cryptocurrency subject will remain in an “absolute informality.”
One of the biggest reasons President Mario Abdo and other deputies have used to exercise a complete veto of this bill has to do with the decisions it makes about the power supplied to cryptocurrency miners. Abdo stated that cryptocurrency mining was an activity with “high consumption of electrical energy but little use of labor.”
The law also established limits on the fees crypto miners pay for the power supplied to their business. This would clash with the method of setting power tariffs by the National Power Administration (ANDE), an organization that also supported the veto measure after finding several cryptocurrency farms illegally connected to the power grid.
Deputy chairman Arnaldo Samaniego argued that rejecting the veto proposal would put ANDE in a tight spot, with potential losses of up to $30 million. Deputy Jose Rodriguez also supported this position, explaining that the organization could not operate with losses derived from this law.
This development puts cryptocurrency regulation in Paraguay back to square one, with lawmakers once again having to propose and debate a hypothetical new cryptocurrency law.
What do you think about the final fate of the cryptocurrency and mining law in Paraguay? Tell us in the comments section below.
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