El Salvador Expands Crypto Regulation Reach with New Paraguay Agreement

El Salvador has taken another significant step in its mission to shape the global crypto landscape by signing a regulatory agreement with Paraguay. This move, formalized last Friday, marks the second such partnership El Salvador has secured in the past three months, following a similar deal with Argentina in December.

The collaboration between El Salvador’s Comisión Nacional de Activos Digitales (CNAD) and Paraguay’s Secretaría de Prevención de Lavado de Dinero o Bienes (SEPRELAD), aims to foster cooperation in overseeing the rapidly evolving crypto sector. With this agreement, El Salvador continues to position itself as a leader in Bitcoin and crypto regulation, sharing its expertise with nations eager to navigate the complexities of this emerging industry.

The Memorandum of Understanding between the two institutions outlines a framework for joint efforts in managing cryptocurrencies. According to SEPRELAD’s statement on its website, the partnership will focus on enhancing anti-money laundering practices and cracking down on unlicensed crypto operations in Paraguay.

A Model for Crypto Governance

El Salvador’s CNAD has earned widespread recognition for establishing one of the most comprehensive crypto regulatory frameworks globally. Designed with a technology-first mindset, the agency serves as the sole gateway for digital asset activities within the country.

Companies operating without a Digital Asset Service Provider (DASP) license from CNAD are considered in violation of the law, a structure that has drawn praise from licensed crypto firms for its clarity and efficiency. This robust system has not only bolstered El Salvador’s domestic crypto ecosystem but also made it an attractive partner for nations looking to regulate their own digital asset markets. While it remains uncertain whether Paraguay will adopt a similar centralized model, the agreement signals a willingness to learn from El Salvador’s approach.

This latest deal with Paraguay reinforces El Salvador’s role as a hub for crypto innovation and governance. As the digital asset space continues to grow, such agreements highlight the importance of cross-border cooperation in addressing challenges such as regulatory gaps. For Paraguay, the collaboration offers a chance to strengthen oversight of its crypto market.