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Paraguay Passes Bill Seeking to Regulate Cryptos

Crypto investments are gaining popularity. There is an increasing awareness on financial technology amongst young and experienced investors. 

Growth of crypto in the global market

In 2009, Bitcoin became the first crypto token to enter the global market. The selling value of this token was only $1 in 2009. Fast forward a decade now, the same token is now sold at $30k per token. This growth precisely explains the growth of crypto in the investment market. Today, the total market capitalization of the crypto token is $3 trillion. The number of tokens has increased from 1 to more than 14k. Many crypto exchanges have been able to list close to 8k tokens on their sites. Along with cryptos, the market also witnessed an increase in non-fungible tokens. These tokens make investments easier and do not exchange with any other cryptos. Another growing product in the market is the concept of Metaverse. 

Adoption of cryptos in different countries

Initially, many investment experts and enthusiasts were against this investment model. Crypto investment works on two main concepts including decentralized finance and blockchain technology.

As the name suggests, decentralized finance is nothing but transactions undertaken anonymously. There is a complete lack of control and intervention by banks. No central bank or regulatory authority tracks crypto transactions. 

Hence, there have always been arguments about using crypto tokens for anti-theft activities. Since there is no lack of control, the investments will also be used for money laundering. In the past, it was also seen that cryptos funded anti-terrorist activities. 

Hence, the fundamental purpose of this token moves away from being an investment. 

Despite, these growing concerns the investment grew. Investors from across the globe embraced cryptos. The token was also able to provide its investors with more than 100% return on investment. India, the US, and the UK take the first three positions in global crypto adoption. 

Along with these, it is also seen that Africa is also getting in the adopting cryptos. It became the second country after El Salvador to legally adopt crypto payments. 

Given the growing interests, many countries are now looking at regulating cryptos. India and the US are setting up committees to analyze this investment. In the recent budget session, India announced the release of a native digital token. Also, earlier Africa had released its native crypto token known as e-Naira.

Crypto adoption in South America

America takes the second position in the market when it comes to crypto investments. The country has been looking at crypto advances very closely. Three years down the line, the US may start accepting taxes using cryptos. 

Paraguay is a new addition to the listing

In late May, the deputy chambers of Paraguay passed a bill on legally accepting cryptos for payments. The regulations provide an insight into crypto payments and mining activity. The regulation is released to the public domain despite non-agreement from banking authorities. The announcement made clear that regulation aims toward making changes in taxation also. Soft taxes along with reduced charges on electricity for mining. The recent changes will make Paraguay another hotspot for crypto investments. Many crypto companies and exchanges would want to leverage the opportunity. Other than direct investment, this rule will also attract indirect investments. The country is also looking at expanding cryptos through user-friendly regulations. 

After El Salvador and the Central African Republic, Paraguay joins the list. The city will make it easier for crypto trading, web3 transactions, and mining. The regulatory agencies are advised to bring forward new schemes to regulate it. 

Global center for miners 

The changes in regulations and crypto adoption will help Paraguay become a hub. Adopting crypto as a new law will enable individual and corporate investors equally. It will also allow changes in investment, mining, and administration of the investing model. 

The law will also provide a legal and financial commitment to individuals. Residents will be protected against major fund losses in crypto investment. Anotherfavoring factor here is the less cost of energy consumption. The cost of power consumption is lesser as compared to other countries. 

The new law is received positively by everyone across the globe. The new law will also make Paraguay another hub for crypto investments. To get a fair idea on Crypto trading

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Written by Marcus Richards

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