New regulatory bill grants Uruguayan Central Bank control over the nation's crypto industry

The Uruguayan government has introduced legislation to the parliament that accelerates the regulation of the crypto space in the country and establishes the central bank as the regulatory authority.

Introduced on Sept 5, the bill strives to clarify the country's regulatory framework for cryptocurrency assets, stating that all companies that provide digital asset-related services, including initial coin offerings (ICOs) are under the supervision of the Superintendency of Financial Services (SSF), a central bank entity. Cryptocurrency exchanges, custody services and any financial services relating to these digital assets should also adhere to Anti-Money Laundering regulations and best practices.

Additionally, the document defined four types of digital assets: stablecoins, governance tokens, tradable assets and debt tokens, saying:

"If the activity carried out with these instruments involves the exercise of financial intermediation or financial activity, it will be subject to the regulation and control of the Central Bank of Uruguay."

Last year, Uruguayan Senator Juan Sartori introduced a draft bill to regulate cryptocurrency and enable businesses to accept digital payments, seeking to “establish a legitimate, legal and safe use in businesses related to the production and commercialization of virtual currencies.”

This development is part of an ongoing wave of legislation or regulations being pursued by governments or legislators in Latin America. Brazil's Securities and Exchange Commission is reportedly pursuing to change its legal framework to recognize tokens as digital assets or securities. In August, Paraguay’s president vetoed a bill that sought to recognize cryptocurrency mining as an industrial activity, arguing that mining’s high electricity consumption could hinder the expansion of a sustainable national industry.