Paraguay Lawmakers Propose Temporary Ban on Crypto Mining Amid Energy Concerns
Paraguay lawmakers have introduced a bill to temporarily ban crypto mining and related activities in the country, citing concerns over illegal mining operations draining power and causing disruptions to the electricity supply. The proposed legislation aims to address the strain on the country’s power grid, particularly in regions like Alto Paraná, where crypto mining activities have surged since 2022.
The ban, if passed, would last approximately six months or until the National Electricity Administration (ANDE) ensures sufficient energy supply for crypto miners without impacting other users of Paraguay’s electrical system. The bill also aims to prohibit the creation, storage, and trading of virtual assets, including cryptocurrencies, as well as the setup of crypto mining farms within Paraguayan territory.
Paraguay has become an attractive destination for cryptocurrency mining operations in recent years due to its abundant and relatively cheap hydroelectric energy. However, the surge in crypto mining activities has raised concerns about energy consumption and its impact on the country’s power grid.
The proposed legislation follows recent actions by Paraguayan authorities to crackdown on illegal crypto mining operations. In March, government officials seized over 1,000 cryptocurrency processing machines at a large crypto mining establishment in the town of Quiindy.
While the bill aims to address the energy concerns associated with crypto mining, concerns have been raised about its potential impact on innovation in the crypto sector. Some critics argue that the bill’s broad language, particularly regarding the definition of “storing” cryptocurrencies, could hinder the growth of the industry in Paraguay.
Overall, the proposed ban on crypto mining in Paraguay highlights the ongoing debate surrounding the regulation of cryptocurrencies and their impact on energy consumption. As the country grapples with the challenges posed by illegal mining operations, lawmakers are seeking to strike a balance between supporting innovation in the crypto sector and ensuring the stability of the country’s power grid.
