El Salvador and Paraguay’s Crypto Regulatory Agreement

El Salvador has entered a regulatory agreement with Paraguay regarding cryptocurrencies.

Last Friday, 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).

The document is expected to facilitate cooperation between the two institutions in the crypto sector, as stated on the SEPRELAD website. SEPRELAD and CNAD will collaborate on detecting and controlling unlicensed crypto operations in Paraguay and strengthening anti-money laundering practices.

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

When asked for more details about the agreement, Reyes referred CoinDesk to a statement from the Central Bank of Paraguay, indicating that cryptocurrencies are not registered or authorized by either the central bank or the Superintendencia de Valores, which was established in 2023 and is part of the Central Bank.

The public was advised to avoid interacting with crypto entities that lacked authorization or regulation from the Superintendencia.

According to Reyes, the central bank’s statement highlights the importance of the regulatory agreement between SEPRELAD and CNAD, although he did not elaborate further.

El Salvador’s CNAD has created one of the most advanced crypto regulatory frameworks globally. The CNAD is specifically designed to regulate digital assets, and its technology-first approach has garnered praise from crypto companies that have obtained El Salvador’s Digital Asset Service Provider (DASP) license.

The CNAD serves as the single point of entry for all digital assets in El Salvador, meaning that operations without a license from the commission are illegal, as previously noted by Reyes. It remains uncertain if the agreement with Paraguay will establish a similar regulatory structure in the South American nation.

In addition to Paraguay, El Salvador has previously signed a crypto regulatory agreement with Argentina’s Comisión Nacional de Valores (CNV) in December.

Regarding international collaboration, Reyes communicated to CoinDesk, “At CNAD we have two core objectives: to share our expertise with international partners, enabling them to harness the benefits of a well-regulated industry, and to broaden the international footprint of our regulated companies by forging strategic partnership agreements with nations worldwide.”