Paraguay Votes Down Crypto Regulatory Bill in a Blow to Crypto Mining Industry

Paraguay's lower house failed to pass a bill that would have regulated crypto, a big blow to the country's burgeoning mining industry.

The South American nation boasts some of the cheapest energy rates in the world, thanks to the Itaipu dam, one of the world's largest. The relatively inexpensive electricity has attracted local and international firms to set up bitcoin (BTC) mines in the country.

The bill would have regulated crypto and mining and was initially passed by the country's Senate in July. President Mario Abdo Benítez, however, vetoed the proposed legislation in August, sending it back to the legislature for amendments and a fresh round of voting. On Monday, the bill garnered only 36 votes in the Chamber of Deputies, short of the 41 it needed to pass.

The industry has found itself in a fight with the local grid operator provider, Ande, and some members of the legislature who claim that the grid's infrastructure cannot handle the excess load and that the industry doesn't greatly benefit the local economy and society. Ande asked the government to increase the electricity tariff for miners in August by as much as 60% over the industrial rate.

The proposed bill would have capped how much Ande can increase miners' tariffs to 15%. That had been a major sticking point for the grid operator and the government.