El Salvador and Paraguay Reach Agreement on Crypto Regulation

El Salvador had previously established a similar agreement with Argentina.

Key Points:

• El Salvador and Paraguay are working together on cryptocurrency regulation.
• This marks El Salvador's second regulatory partnership in the past three months.
• El Salvador is recognized for having one of the most comprehensive crypto regulatory frameworks globally.

El Salvador has established a regulatory partnership with Paraguay concerning cryptocurrency oversight.

Paraguay’s Secretaría de Prevención de Lavado de Dinero o Bienes (SEPRELAD) signed a Memorandum of Understanding (MOU) with El Salvador’s Comisión Nacional de Activos Digitales (CNAD) last Friday.

The agreement aims to enhance cooperation between the two institutions in regulating the crypto sector, according to SEPRELAD's official statement.

As part of the partnership, SEPRELAD and CNAD will work together to identify and monitor unlicensed crypto operations in Paraguay while also reinforcing anti-money laundering measures.

“El Salvador continues to share its experience and success in digital assets, strengthening international alliances to build a more connected and transparent future,” CNAD President Juan Carlos Reyes stated on X. “This agreement not only promotes innovation but also ensures financial integrity in a borderless economy.”

When asked for specifics about the agreement, Reyes pointed to a statement from the Central Bank of Paraguay on Thursday. The statement clarified that cryptocurrencies are neither registered nor authorized by the central bank or the Superintendencia de Valores, a regulatory body established in 2023 under the Central Bank.

Paraguayans were cautioned against engaging with crypto entities that lack authorization or regulation from the Superintendencia.

Reyes emphasized that the central bank’s statement highlights the significance of the regulatory agreement between SEPRELAD and CNAD but did not provide further details.

El Salvador’s CNAD has built one of the most advanced crypto regulatory frameworks globally. Designed specifically to oversee digital assets, CNAD has been praised for its technology-driven approach, earning recognition from crypto companies that have obtained El Salvador’s Digital Asset Service Provider (DASP) license.

Notably, CNAD serves as the sole regulatory authority for digital assets in the country, meaning that any entity operating without a CNAD license is in violation of the law. It remains unclear whether Paraguay’s agreement with El Salvador includes plans to establish a similar regulatory structure.

El Salvador previously signed a crypto regulatory agreement with Argentina’s Comisión Nacional de Valores (CNV) in December.

“At CNAD, we have two main objectives for international collaboration,” Reyes stated at the time. “To share our expertise with global partners, helping them harness the benefits of a well-regulated industry, and to expand the international presence of our regulated companies by forming strategic partnerships with other nations.”