Last month, Panama’s parliamentary assembly enacted a bill focusing on crypto regulation and licensing crypto exchanges in the country. President Cortizo delayed signing the bill on May 19. Panama President, Laurentino Cortizo, feels anti-money laundering provisions are critical for the country and should be added to the crypto bill. He remarked that crypto can be used by hackers for money laundering and other financial crimes so adding anti-money laundering provisions is important. Unless the bill is signed by the president, the acceptance of crypto in Panama remains doubtful.
President Cortizo noted:
“If I’m going to answer you right now with the information that I have, which is not enough, I will not sign that law. I have to be very careful if the law has clauses related to money laundering activities. Anti-money laundering activities are very important to us.”
Recently, Panama has been added to the Financial Action Task Force’s (FATF) “grey list” of nations with lax anti-money laundering laws. The Cortizo government is currently implementing FATF recommendations to combat money laundering, terror funding, and financial crimes. Anti-money laundering regulations are, in fact, useful for crypto legislation. Adoption and commercialization of crypto assets in the country might improve offshore financial services even more.
The utilisation of crypto assets for both private and public purposes will strengthen Panama’s financial services sector. Furthermore, due to widespread internet use, banks will become more crypto-friendly, and crypto assets may be able to assist the unbanked.
According to Panamanian congressman Gabriel Silva, the bill provides guidelines for the trade and usage of crypto assets; the issue of digital securities; the creation of new payment systems; and the tokenization of precious metals.
Experts, on the other hand, believe that accepting crypto will make Panama a location where financial openness is missing. Due diligence procedures are bypassed, putting Panama in a vulnerable situation.
As individuals become more interested in digital assets, NFTs, and the metaverse, crypto acceptance is increasing in Panama. The government is paying close attention to the usage of blockchain technology.
After the assembly passed the crypto bill, crypto exchanges and corporations are already planning to set up shop in Panama. Deribit, a cryptocurrency derivatives exchange, has previously relocated to Panama while extending its KYC policies. Crypto companies and exchanges looking to expand now face uncertainty.
