Panama’s crypto bill saga has reached a new chapter, with the country’s Supreme Court deciding the future of the local crypto industry.
The President of Panama Laurentino Cortizo sent on January 26 Bill No.
The Supreme Court must now decide whether to declare the law unenforceable or approve it with modifications.
According to the official statement, the government considers articles 34 and 36 of the bill unenforceable, because they violate the separation of powers of the state and create an administrative structure in the government.
President Cortizo also denied that the bill had been approved through an inadequate procedure, after the partial veto of the legislation in June. At the time, the president considered the bill needed more work to comply with new regulations recommended by the Financial Action Task Force (FATF) that reflect “fiscal transparency and money laundering prevention.”
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The dispute between the Panamanian congress and the government has focused on this bill. In April 2022, Panamanian parliamentarians passed a legislative proposal aimed at regulating cryptocurrencies in the country, including Bitcoin. However, President Cortizo warned a few weeks later that he would not sign if it did not include Anti-Money Laundering (AML) rules.
The bill was introduced in September 2021 to the National Assembly of Panama, with the aim of making the country “compatible with the digital economy, blockchain, crypto assets and the internet.” It was moved from the Economic Affairs Committee on April 21 before being approved by the local congress.
Based on the law, Panamanians “may freely agree on the use of crypto assets, including without limitation Bitcoin and Ethereum” as an alternative payment for “any civil or commercial operation.”
Furthermore, the bill will regulate the tokenization of precious metals and the issuance of digital values. Digitization of identity using blockchain or distributed ledger technology will also be examined by the government’s innovation authority.