The Supreme Court of Panama to decide on cryptocurrency regulations
Currently, the “crypto law” is up for consideration by the Supreme Court, which will ultimately determine whether to strike it down or modify it.
The debate over the Panamanian crypto bill’s future has entered a new phase as the nation’s Supreme Court prepares to rule.
The so-called “crypto bill,” according to Panamanian President Laurentino Cortizo, violates the fundamental principles of the constitution and is therefore unenforceable. He sent the crypto legislation passed last year to the high court for review on January 26.
Bill №697 must now be decided upon by the Supreme Court, which will either deem it unenforceable or approve it with revisions. According to a formal declaration, articles 34 and 36 of the bill are deemed unenforceable by the president’s office because they build administrative structures within the government and violate the state’s separation of powers.
Following his partial veto of the law in June, President Cortizo also claimed that the mechanism used to approve the bill was insufficient. The president argued that the legislation required additional effort to comply with the new rules suggested by the Financial Action Task Force to increase fiscal transparency and fight money laundering at the time.
The National Assembly of Panama and the government are at odds over this law. A bill intended to control cryptocurrencies, such as Bitcoin, in Panama was approved by parliament in April. But a couple of weeks later, President Cortizo issued a warning, saying he wouldn’t sign it unless it contained more anti-money laundering (AML) regulations.
In September 2021, a bill was submitted to make the nation “compatible with the digital economy, blockchain, crypto assets, and the internet.” It was removed from the Economic Affairs Committee on April 21 and approved a few days later.
The law states that citizens of Panama “may freely agree on the use of crypto assets, including without limitation Bitcoin and Ethereum,” as a substitute payment for “any civil or commercial operation.”
The bill would also control the issuance of digital currency and the tokenization of precious metals. The government’s innovation authority would also investigate the digitization of identity using blockchain or distributed ledger technologies.
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