Panama Passes Bill To Allow Use Of Crypto Assets

PANAMA CITY, April 28 (Reuters) – Lawmakers in Panama’s National Assembly on Thursday approved a bill that seeks to regulate the use and marketing of crypto assets in the Central American country known as a trading hub. offshore financial services.

The bill opens the door to private and public use of crypto assets and will allow people to pay their taxes with cryptocurrencies. Experts have warned that this could bolster Panama’s reputation as a country lacking in financial transparency.

The legislation is broader in scope than measures passed by El Salvador, which last year made bitcoin legal tender, said independent lawmaker and bill sponsor Gabriel Silva.

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“We are seeing many different types of crypto assets emerge as works of art,” he said. “That’s why we didn’t want to limit ourselves to just cryptocurrencies.”

The bill covers the trading and use of crypto assets, the issuance of digital securities, new payment systems, and the tokenization of precious metals. Tokenization occurs when the rights to an asset are converted into digital formats.

Under the new legislation, Panamanians can use crypto assets as payment for any civil or commercial transaction not prohibited by the law of the country.

Panama is on the European Union’s list of tax havens, and Romain Dromard, chief executive of financial investment advisory firm K&B Family Office, says the proposed crypto bill won’t help it appear. more transparent.

“Panama was already in a bad position and these payment methods ignore the due diligence processes that international organizations are asking Panama to adopt,” he said.

The bill, which now goes to President Laurentino Cortizo for signing, passed the assembly with 38 votes in favor, two abstentions and no votes against.

Belisario Castillo Saenz, chief executive of tokenization firm Feänor Corp, argued that crypto assets could help the unbanked, given that internet penetration is high in Panama, but only one in four people have bank accounts.

The bill could also make banks that have created barriers to using cryptocurrencies more cooperative, said Jose Fabrega of CryptoSPA, a hub for crypto and blockchain services.

Still, K&B’s Dromard said the role banks will play under the new rules is unclear and predicts it will take years for traditional institutions to use the assets.

Moreover, small and medium-sized companies could not switch to such volatile assets, he argued.

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Reporting by Elida Moreno and Valentine Hilaire; Editing by Cynthia Osterman

Our standards: The Thomson Reuters Trust Principles.

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Panama Passes Bill To Allow Use Of Crypto Assets

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