- Lawmakers in Paraguay are striving to halt all current and future crypto mining operations due to surging power consumption
- Crypto mining farms, legal and illegal, are exacerbating electricity consumption amid a sweltering summer, straining the grid and prompting drastic measures
- The proposed bill may inadvertently ban unrelated crypto activities like staking and asset holding in wallets, potentially impacting the broader crypto ecosystem
Lawmakers in Paraguay are attempting to put an end to all current and future crypto mining ventures in the country following an increasing consumption of power. Crypto mining farms, both legal and illegal, are guzzling electricity during a sizzling summer where the grid is being put under more and more pressure, leading to the extreme action. The bill could have a knock-on effect, however, as it could outlaw unrelated crypto activities such as staking and even holding assets in a wallet.
180-day Mining Ban Proposed
The draft legislation underscores the government’s desire for a comprehensive regulatory framework to address various challenges within the crypto ecosystem, ranging from consumer protection issues to concerns regarding illicit activities like money laundering and tax evasion.
Included is a paragraph that sums up the ambition of the new law: politicians want to temporarily halt the “creation, preservation, storage, and commercialization of virtual assets or crypto-assets, cryptocurrencies, and the installation of crypto-mining farms in Paraguayan territory.”
If enacted, the proposed ban could remain in effect for 180 days or until adequate regulatory measures are established, ensuring that the country’s energy infrastructure can sustain the demands of crypto mining during the heatwave, which will see temperatures hit 96 degrees this weekend, without compromising overall grid stability.
Impact Extends Beyond Mining
Despite the bill’s broad language, its primary focus appears to be on curbing the proliferation of illegal crypto mining farms, which have skirted existing regulations and drained significant amounts of electricity from the grid.
However, the bill’s potential ramifications extend beyond mining operations, raising concerns about the legality of activities such as crypto staking and even the simple act of holding digital assets in wallets. Violations of the proposed law would carry sanctions in accordance with existing financial regulations and criminal statutes, reflecting the government’s resolve to address the economic and regulatory challenges posed by the crypto industry.
Despite initial support for the bill, it faces criticism from local experts, signaling potential hurdles to its passage into law.
