Panama approves digital currency regulation bill

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The Republic of Panama is set to become the latest country to regulate the rapidly-growing digital assets industry. The economic affairs committee in the Latin American country’s parliament approved a bill that was introduced back in September 2021 and seeks to establish a regulatory framework for the digital assets industry as well as pave the way for widespread use of blockchain technology.

As CoinGeek reported in September, Congressman Gabriel Silva introduced the bill, saying that it would “make Panama a country compatible with the blockchain, crypto assets and the internet.” Known as the Crypto Law, the lawmaker projected that it would create thousands of jobs in the Central American country.

Silva took to Twitter to announce that his bill had successfully sailed through parliament.

Aprobada en primer debate la Ley de Crypto! Este proyecto es importante porque:

-Da claridad jurídica al uso opcional de criptoactivos y a las plataformas de economía digital
-Crea empleo y promueve inclusión financiera
-Busca que se use la tecnología blockchain en sec público pic.twitter.com/VcGyjhxUfO

— Gabriel Silva (@gabrielsilva8_7) April 21, 2022

The lawmaker believes the bill will “give legal clarity to the use of crypto assets and digital economy platforms” and “create employment and promote financial inclusion.”

However, he revealed that the bill had to go through some changes, although he didn’t elaborate on the changes. The legislator further called on the Panamanian public to submit their feedback for future parliamentary debates.

The bill will now be introduced to the floor of the parliament, where it will undergo a second debate. Lawmakers will propose any changes or modifications during this stage, although they can shoot it down altogether. It will then proceed to the third session, and if it’s approved, it will be handed to President Laurentino Cortizo, who will either sign it into law or veto it.

The Crypto Law is a big step both for Panama and the region as it could set the tone for other countries seeking to police digital assets. And to its credit, it has done a remarkable job of laying out how digital assets can promote financial inclusion and even create jobs in the country. It further debunks the myth that digital assets promote crime, a misrepresentation that many regulators have used as their justification for anti-Bitcoin stands.

However, just like its fellow Central American neighbor El Salvador, the Panamanian Crypto Law looks at digital assets more as an investment than a currency. This stems from the widely-held albeit misled narrative that BTC proponents have pushed for years that the digital asset is digital gold. With BTC unable to scale and its transactions remaining not just agonizingly slow but expensive, it has been reduced to an instrument for speculative investment.

Despite some of the misrepresentations, the bill will pave the way for widespread adoption of digital assets in Panama, and in time, Bitcoin SV will emerge as the only digital currency that can facilitate the digital economy that Panamanian leaders have in mind.

Watch: Head of Unit, Digital Innovation and Blockchain at DG Connect, European Commission Pēteris Zilgalvis on Bitcoin Association’s Blockchain Policy Matters