Andora Passes Digital Assets Act Giving Green Light to Blockchain and Bitcoin
Digital currencies and cryptos are not allowed as legal tender in Andorra
By Shashank Bhardwaj
Andorra, a small European nation between France and Spain, is a beacon of progress. The Digital Assets Law, which establishes a legal framework for virtual currencies and blockchain technology, recently received approval from the General Council of Andorra.
The law is divided into two sections. The first component is to develop a “programmable digital sovereign currency”. Andorran citizens can transact using this digital currency in a closed system. To put it simply, this section of the law points to a possible deployment of a CBDC system in Andorra in the near future.
The second section of the law deals with regulations surrounding distributed ledger and blockchain technologies. The law also refers to crypto and other digital assets as financial instruments. According to Paul (who chose not to use his last name), the new rule could attract new customers, including the CEO of local Bitcoin company 21Million. He said: “The result they are trying to achieve is to attract new businesses to set up in the country by offering legal clarifications to make things easier and more transparent. They see it as a way to attract talent and entrepreneurs to the new economy. “
Crypto-assets and other digital currencies are not recognized as legal tender in Andorra and the Digital Assets Law does not offer any new provisions for methods of exchange through these assets. This privilege was granted only to the euro, the preferred currency of the European Central Bank. Despite this, Paul, an avid Bitcoiner, continues to advocate for the acceptance of Bitcoin (BTC) in Andorra.
The digital assets law is a step towards “making crypto an everyday reality”, according to national newspaper Diari d’Andorra. Paul asserted that the measures taken by the Andorran government with regard to digital assets determine how “crypto-friendly” everything will be from a commercial point of view.
Josselin Tonnellier, the co-founder of StackinSat, claimed that crypto, blockchain, non-fungible tokens and Bitcoin are still not very well understood in the country. Regarding Andorra, he said: “Andorra is very attractive for entrepreneurs thanks to its low taxation, but Switzerland has a good head start in fostering the development of activities around Bitcoin and cryptocurrencies in general. This could change in the years to come thanks to this text of law which regulates the activities of Bitcoin and the blockchain.
Andorran Minister of Economy and Business, Jordi Gallardo, said in an interview in May that Andorra is focusing on blockchain as one of its main funding areas. Although it is impossible to say for sure if the Minister was talking about Bitcoin or DLT in general. Moreover, the digital assets law recently approved by the Andorran government does not clearly specify to which digital funds it would apply. However, the motion, being economically motivated, could encompass crypto and blockchain based companies to diversify the Andorran financial system.
Shashank is the founder of yMedia. He ventured into crypto in 2013 and is an ETH maximalist. Twitter: @bhardwajshash