Agencies in Paraguay are poised to embrace the cryptocurrency sector. What remains is the necessary legislation.
This was highlighted by Juan Carlos Reyes, the head of the Comisión Nacional de Activos Digitales (CNAD), responsible for cryptocurrency regulation in El Salvador.
“From my perspective, it looks like Paraguay has established a solid foundation for oversight, regulations, and tax structures. They appear to be waiting for the legislative body to formally propose or approve a law to advance these efforts,” Reyes stated.
On Friday, Reyes signed a regulatory agreement regarding cryptocurrencies with Liliana Elizabeth Alcaraz Recalde, the leader of Paraguay’s Secretaría de Prevención de Lavado de Dinero o Bienes (SEPRELAD). This agreement aims to enhance collaboration between the two nations in the realm of crypto, particularly in managing and overseeing unauthorized crypto activities in Paraguay and improving anti-money laundering efforts.
“During my time here, I had the opportunity to witness a presentation from the Director of Taxation, who discussed the proposed strategy and direction for cryptocurrency regulations once the government provides legislative clarity,” Reyes shared. “We’ve been collaborating with Paraguay’s Financial Investigative Unit for a while, exchanging best practices and examining how El Salvador has effectively regulated this market.”
El Salvador boasts one of the most thorough frameworks for cryptocurrency regulation globally, prompting other countries to seek guidance from the Central American nation. In December, Reyes had previously signed a similar agreement with Argentina’s Comisión Nacional de Valores (CNV).
“One issue I have regarding the lag in establishing clear regulations is the risk of an informal crypto market flourishing. If this is not addressed promptly, it could expand to an extent that becomes challenging, if not impossible, to supervise adequately,” Reyes expressed concerning Paraguay.
“It brings to mind the unregulated exchange of U.S. dollars outside formal retail channels in numerous countries with their own currencies,” he continued. “Independent sellers might offer better rates, yet there is a lack of traceability of funds and transparency regarding the participants. Without prompt regulation, I fear cryptocurrencies might follow a similar path here, growing to a size that is difficult to manage effectively.”
SEPRELAD has not yet responded to a request for comment.