Nikolas Sargeant
According to Criptonoticias, a Spanish-language media outlet, the bill was introduced by lawmaker María Constancia Benítez.
The bill is reportedly pro-business, emphasizing the potential of the Bitcoin mining industry to drive economic and technological development in Paraguay.
Will Paraguay Finally Regulate Bitcoin Mining?
Benítez’s bill must pass the committee stage before it can be voted on by lawmakers. Notably, this is the fourth attempt by Paraguayan parliamentarians to regulate the sector.
A 2022 bill, co-authored by mining firms and their lawyers, was approved by both houses but ultimately vetoed by the President. The new bill indicates lawmakers' continued interest in positioning Paraguay as a significant BTC mining hub.
Benítez’s draft law argues that Bitcoin mining can attract foreign investment and create jobs. The bill states:
"Legislating crypto mining is fundamentally important, as it can attract both foreign and domestic investments and boost employment. This will position Paraguay as a modern, technological hub in the Latin American region." The bill also asserts that regulating Bitcoin mining would create a legal and economic security environment for operators, which is "essential for the sustained development" of the BTC mining sector, according to Benítez.
Bill Proposes AML and CFT Measures
The bill includes provisions for anti-money laundering (AML) and counter-terrorism financing (CFT) protocols within the industry.
Additionally, it proposes that BTC miners adhere to strict environmental regulations, emphasizing the use of renewable energy sources.
This aspect is particularly appealing given that Paraguay generates nearly all its power from hydroelectric plants. This renewable energy source has attracted global mining firms, which have established data centers near major dams. These dams provide surplus energy to miners during rainy seasons when water flow is abundant.
However, the bill is expected to encounter significant opposition. Power companies have attributed network disruptions to illegal crypto mining activities, with many miners illegally tapping into local grids. This has led to a police crackdown, resulting in the recent seizure of around 3,000 Bitcoin ASIC miners.
