Uruguay Cryptocurrency Laws Regulation of Digital Currencies: Cryptocurrency, Bitcoins, Blockchain Technology
Uruguay has not currently enacted regulations or legislation specifically regulating digital currency yet. Thus, the legal status of cryptocurrency in Uruguay is controversial based on Uruguay’s cryptocurrency regulation report. According to Cointobuy’s the crypto-related activity in this country has a 2.2/10 safety rank (position 154 out of 249 countries) in terms of cryptocurrency safety. [1]
However, the Uruguayan Central Bank has been conducting pilot projects to monitor and assess cryptocurrency focusing on creating risk-based regulations letting the country to take advantage of the opportunities of new systems and the digital revolution, removing entry barriers, reducing transaction costs, and boosting efficiency. [2]
Despite not having issued cryptocurrency regulations yet, the country has an openness to ICTs, competitive talent and specific incentives are some of the advantages that the country offers for the development of this powerful technology. In 2020, Uruguay hosted the “Blockchain Summit Global” as part of its strategy to boost the sector and promote Uruguay as a business technology hub. [3]
Uruguay offers a series of incentives to technology companies, encouraging the development of the digital currency sector, for example: set out in the Investment Law, the Free Zone Law and the Software Law. Likewise, the country presents a regulatory framework that facilitates business: equal treatment to foreign and local investors, free market of foreign currency, no requirement of local counterpart, no restriction of profit repatriation and a unique tax system. In addition. The country also has highly developed industries where digital currency can be applied: agribusiness, logistics, finance, and energy, among others.
P.S. Insights on Cryptocurrency Legal Issues
Most jurisdictions and authorities have yet to enact laws governing cryptocurrencies, meaning that, for most countries, the legality of crypto mining remains unclear.
Under the Financial Crimes Enforcement Network (FinCEN), crypto miners are considered money transmitters, so they may be subject to the laws that govern that activity. In Israel, for instance, crypto mining is treated as a business and is subject to corporate income tax. In India and elsewhere, regulatory uncertainty persists, although Canada and the United States are relatively friendly to crypto mining.
However, apart from jurisdictions that have specifically banned cryptocurrency-related activities, very few countries prohibit crypto mining.
Our Freeman Law Cryptocurrency Law Resource page provides a summary of the legal status of cryptocurrency for each country across the globe with statutory or regulatory provisions governing cryptocurrency. The globe below provides links to country-by-country summaries:
[1] Cryptocurrency Analysis, “Ultimate crypto investment safety rankings”, (Jun. 2, 2021). Available at https://cointobuy.io/countries/uruguay
[2] Has the Uruguayan Central Bank Taken a Crypto U-turn? (Sep. 10, 2019). Available at https://cryptonews.com/news/has-the-uruguayan-central-bank-taken-a-crypto-u-turn-4616.htm
