The Executive Branch of the Uruguayan Government Has Proposed a Crypto Bill

The legislative branch of Uruguay's government has been given a bill proposal by the country's executive branch, with the intention of elaborating on the manner in which bitcoin assets and activities related to them will be governed. If it passes, this will be the first bill in the country that addresses the legal limbo in which cryptocurrency exchanges and companies that provide services related to virtual assets operate.

The proposed legislation makes changes to the original charter of the Central Bank of Uruguay and establishes the Superintendence of Financial Services, an agency that is already a component of the central bank, as the primary supervisor of the activities of virtual asset service providers. In this sense, the document establishes that parties who lend financial services related to the offer or sale of a virtual asset, as well as custody providers, companies that facilitate the purchase and exchange of virtual assets, and third parties who lend financial services related to the offer or sale of a virtual asset, will be considered to be members of this class.

However, the bill creates a new kind of organization known as "virtual asset issuer" and defines it as a platform that either issues any kind of virtual asset that is included inside the regulatory perimeter or asks to have regulated virtual assets admitted to a virtual asset trading platform.

The Uruguayan Central Bank Will Serve as the Primary Cryptocurrency Supervisor

The proposed legislation, similar to other legislative initiatives in the region that aim to establish organizations as the primary crypto watchdogs, would give the country's central bank complete authority over all supervision relating to these responsibilities. The document declares:

With the adjustments that have been proposed, the powers of supervision and control that are currently held by the Central Bank of Uruguay will be extended to include not only the previously regulated topics but also the newly incorporated entities that deal with virtual assets.

The text also makes mention to virtual asset securities, which are known as the digital equivalents of the traditional financial securities. These digital counterparts are referred to as "virtual counterparts."

There have been past attempts made in the country to legalize the use of cryptocurrency as a mode of payment. This objective was intended to be accomplished through the cryptocurrency bill project that Senator Juan Sartori submitted the previous year. Additionally, in the month of August, the Central Bank of Uruguay served a summons on Binance because of the exchange's provision of cryptocurrency-based financial products with a focus on savings.