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A proposed law would establish cryptocurrency as an established form of alternative payment in Panama and help clear the way for wider acceptance of bitcoin, ethereum, and other elements of the digital economy.

The law is only in draft form, but clearly, momentum is building to formally embrace cryptocurrencies in Panama. The proposal comes in the wake of El Salvador’s announcement that it would accept bitcoin as legal tender, the latest in a series of increased acceptance in the corporate and financial world.

As we’ve reported in the past, crypto is already a growing part of the real estate conversation. We’re encountering more and more buyers and sellers willing to use bitcoin and other digital currencies to make transactions.

The Panama law would make crypto acceptable  for “any civil or commercial operation not prohibited by the legal system of the Republic of Panama.” The bill is not limited to bitcoin and would support the use of the blockchain in the public sector as well as the banking sector, according to media coverage.

The bill’s sponsor, congressman Gabriel Silva, said the new law could generate jobs, spur investment and make the cryptocurrency currency world “more transparent.” The goal is to make Panama “compatible”  blockchain and crypto-assets. The proposal also notes that digital currencies serve as a hedge against inflation, and enable fast and low-cost payments “regardless of the distance between parties and the transaction volume.”

Many governments in Latin America are considering different ways to embrace crypto. Panama’s proposal is much less dramatic than El Salvador’s approach, which has been criticized for forcing businesses to accept bitcoin. 

Silva says the new bill “does not oblige and does not seek to impose digital currency, or forced means of payment, but the freedom to use cryptocurrencies such as Bitcoin or Ethereum,” according to coverage in Telemetro.