Crypto Overview in Paraguay

Regulatory data is for informational purposes only and may not reflect the most current legal developments. Always consult qualified professionals before making decisions.

Legal Classification and Regulatory Framework

Cryptocurrency Status

Paraguay has no comprehensive cryptocurrency law. Virtual assets are not legal tender; only the guarani carries that status, and the Banco Central del Paraguay has repeatedly confirmed, beginning with a formal communique in 2019 and in subsequent reaffirmations, that cryptocurrencies are neither banknotes nor coins and carry no state guarantee. A 2021 bill that would have established a dedicated regime for mining and trading was passed by Congress in 2022, vetoed by then-President Mario Abdo Benitez in August 2022, and archived by the Chamber of Deputies later that year. An April 2024 bill proposing a 180-day suspension of mining was paused after Senate opposition, with legislators concluding that licensed operations generate material revenue for the national electricity utility. As of May 2026, at least five bills dealing with virtual assets have been submitted since April 2024, but none has been enacted into a comprehensive statute.

Crypto activity is legal. Virtual asset service providers are subject to AML/CFT obligations under SEPRELAD Resolution 314/2021, which formally designates them as obligated subjects under Law 1015/1997. Mining operators must register with the Ministry of Industry and Commerce (MIC) following congressional resolutions of December 2024 directing the MIC to compile a registry of authorised operators, and must obtain an authorised industrial electricity connection from ANDE, the national electricity utility. Law 7572/2025 on the Securities and Products Market assigns oversight of tokenised securities to the Superintendencia de Inversiones (SIV), the successor to the prior Comision Nacional de Valores function, creating a second regulatory track for security tokens alongside SEPRELAD’s AML perimeter.

Tax Treatment

Paraguay operates a territorial tax system. Only income sourced within Paraguay is subject to taxation; foreign-source income is generally outside the tax net, a factor that has attracted international mining operators and crypto-focused residents. Corporate income (Impuesto a la Renta Empresarial, IRE) is taxed at 10%. Personal income (Impuesto a la Renta Personal, IRP) is taxed at progressive rates of 8% or 10%. VAT is levied at 10% on most transactions; crypto-to-crypto trading is exempt under the private securities exception in Paraguay’s modernisation tax law, though goods or services paid for with cryptocurrency are taxed at the underlying VAT rate as a barter transaction.

DNIT issued Resolucion General 47/2026 on March 10, 2026, establishing mandatory annual reporting of all digital asset transactions for platform operators and individual holders. Platforms must report every user transaction; individuals must report wallet addresses and transaction hashes for activity generating taxable gains. First filings cover fiscal year 2026, with returns due in early 2027.

Regulatory Oversight

The Banco Central del Paraguay is the monetary authority. It has issued public warnings about virtual assets but holds no licensing or supervisory role over VASPs. The Superintendencia de Inversiones (SIV), the successor authority to the former Comision Nacional de Valores under Law 7162/2023, oversees securities markets and, under Law 7572/2025, regulates tokens representing transferable securities or credit rights. SEPRELAD is the financial intelligence unit and the lead AML/CFT supervisor for the crypto sector. DNIT is the tax authority with growing enforcement reach over digital assets. The Ministry of Industry and Commerce maintains the mining registry, and ANDE is in practice one of the most consequential regulators of crypto activity through its tariff decisions and authorisation of industrial power connections.

Business Environment

Banking Relationships

The major commercial banks include Banco Continental, Itau Paraguay, Banco Nacional de Fomento, Banco GNB, Sudameris, Atlas, and Vision Banco. Following central bank guidance, banks generally avoid offering crypto-related services and have been known to restrict or close accounts of customers who engage extensively in crypto activity. The dominant mobile money rail, Tigo Money, does not natively integrate with crypto on- or off-ramps. Off-ramping from cryptocurrency to local fiat typically occurs through peer-to-peer markets and regional exchanges rather than formal banking channels.

Innovation Support

The central bank operates no dedicated crypto sandbox. Its principal fintech initiative is the instant payment system launched in 2022, which provides round-the-clock free transfers between participants. A central bank working group has studied a sovereign digital guarani since 2021 and published technical papers, but no pilot has been announced. In practice, innovation has been driven by the private mining industry working alongside ANDE on tariff structures, grid investment, and long-term power purchase agreements, rather than by formal regulatory facilitation. ANDE and operators are also developing dollar-denominated tariff structures aimed at attracting artificial intelligence and high-performance computing workloads, diversifying beyond pure Bitcoin mining.

Crypto License in Paraguay

Paraguay has no formal VASP licensing regime. The country’s regulatory approach is AML-registration-based for service providers and authorisation-based for mining operators, with no central bank or securities regulator issuing operating licences for exchanges or custodians.

Current Status

Virtual asset service providers carrying out activities including exchange, transfer, storage, custody, or administration of digital assets for third parties are required to register with SEPRELAD as obligated subjects under Resolution 314/2021 and the underlying AML/CFT framework of Law 1015/1997, as amended. Registration requires appointment of a dedicated compliance officer, implementation of KYC and customer due diligence procedures, beneficial ownership identification, transaction monitoring, suspicious transaction reporting to SEPRELAD, and annual internal and external audits for firms above a defined billing threshold. There is no BCP or CNV operating licence to apply for, and no fee structure or capitalisation requirement attached to SEPRELAD registration beyond administrative costs.

Bitcoin and cryptocurrency mining operators face a separate dual-track process. Since December 2024, congressional resolutions require the MIC to maintain a registry of all individuals and legal entities authorised to mine. Miners must register with the MIC and separately obtain an authorised industrial electricity connection from ANDE, which applies a tariff of approximately $40 per megawatt-hour for licensed mining consumers. As of 2024, 45 operations held licensed status with ANDE, with approximately 20 additional applications pending. Civil and criminal penalties apply to unauthorised activity, including up to ten years imprisonment for illegal mining operations.

Why No Framework

The absence of a comprehensive VASP law reflects repeated legislative stalling rather than a deliberate permissive policy. The 2022 mining and trading bill was vetoed on fiscal and consumer protection grounds. Subsequent attempts have been fragmented, with bills addressing illegal mining, AML gaps, and industrial electricity use separately rather than through a unified statute. The BCP’s cautionary stance has prevented it from championing a licensing regime, and the CNV’s mandate has been interpreted narrowly to cover only security tokens. In March 2025, El Salvador’s National Commission of Digital Assets (CNAD) noted publicly that Paraguay was “only waiting for a crypto law,” and the two regulators signed a memorandum of understanding on AML cooperation and detection of unlicensed operations that same month, reflecting international pressure for a formal framework.

What Operators Should Know

Firms operating as exchanges, custodians, or intermediaries must complete SEPRELAD registration before conducting business; operating without it exposes firms to administrative penalties and criminal liability under Law 1015/1997. DNIT Resolution 47/2026 creates a parallel reporting obligation covering all user transactions from fiscal year 2026 regardless of SEPRELAD status. Mining operators must complete the MIC registry application and obtain ANDE industrial connection authorisation. Law 7572/2025 adds a third track for tokens qualifying as securities, which fall under SIV supervision. Paraguay’s GAFILAT action plan runs to 2028, and regulatory obligations are likely to tighten incrementally as the country works toward full FATF compliance.

Market Characteristics

Adoption Patterns

Retail adoption is modest. Dollar-pegged stablecoin use occurs for cross-border trade and savings, particularly along the border with Brazil at Ciudad del Este where active commercial flows create demand for price-stable digital instruments. No major Paraguay-headquartered exchange operates publicly. Users rely on regional platforms and peer-to-peer markets. Paraguay’s territorial tax system and streamlined residency pathways have attracted crypto-focused individuals seeking tax-efficient domicile, a trend reinforced by a migration law modernisation in late 2025. The dominant cryptocurrency story in Paraguay remains an industrial one, defined by its position as a major global Bitcoin mining destination rather than by consumer adoption.

Industry Focus

Paraguay has established itself as one of the world’s largest Bitcoin mining jurisdictions, supported by large surplus hydroelectric capacity from the binational Itaipu Dam (shared with Brazil) and the Yacyreta Dam (shared with Argentina). Survey data from Hashrate Index places Paraguay at approximately 4.3% of global Bitcoin hashrate, ranking among the top four jurisdictions worldwide behind only the United States, Russia, and China.

HIVE Digital Technologies is the largest single operator. It acquired the Yguazu 200 MW site from Bitfarms in January 2025 and added a Valenzuela 100 MW facility, reaching 300 MW of total Paraguay capacity by October 2025 and targeting 35 EH/s by 2026. Other significant operators include Marathon Digital and Penguin Group. ANDE collected approximately $100 million in tariff revenue from mining in 2024, rising to $295 million in 2025, with $350 million projected for 2026. ANDE and operators are also pursuing long-term dollar-denominated power agreements aimed at attracting artificial intelligence and high-performance computing workloads.

Regulatory Evolution

Paraguay is a member of the Grupo de Accion Financiera de Latinoamerica (GAFILAT) and is not on the FATF list of jurisdictions under increased monitoring as confirmed by the June 2025 FATF update. The 4th Round mutual evaluation, adopted at the GAFILAT XLV Plenary in July 2022, placed Paraguay in enhanced follow-up, with findings identifying weaknesses in the proportionality of money-laundering sanctions and in the volume of FIU output relative to assessed risk. Paraguay updated its GAFILAT action plan via Decree 2463/2024 in October 2024, extending the enhanced follow-up period through 2028. Within the wider Mercosur region, Paraguay carries the lightest formal regulatory burden on virtual asset firms but is under the most active international scrutiny to construct a framework, a dynamic that makes incremental tightening over the remainder of the decade the most likely trajectory for the sector.