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THE BIZNOB – Global Business & Financial News – A Business Journal – Focus On Business Leaders, Technology – Enterpeneurship – Finance – Economy – Politics & LifestyleTHE BIZNOB – Global Business & Financial News – A Business Journal – Focus On Business Leaders, Technology – Enterpeneurship – Finance – Economy – Politics & Lifestyle

Cryptocurrencies

Cryptocurrencies

Andorra green lights Bitcoin and Blockchain with Digital Assets Act

Andorra green lights Bitcoin and Blockchain with Digital Assets Act
Photo by Karolina Grabowska/close up shot of a bitcoin-buried in the ground Photo by Karolina Grabowska/close up shot of a bitcoin-buried in the ground
Andorra green lights Bitcoin and Blockchain with Digital Assets Act
Photo by Karolina Grabowska/close up shot of a bitcoin-buried in the ground Photo by Karolina Grabowska/close up shot of a bitcoin-buried in the ground

Andorra, a small nation in Europe tucked between France and Spain, is a glimmer of development. The General Council of Andorra, the nation’s government, recently gave the Digital Assets Act, a legal framework for digital currencies and blockchain technology, its blessing.

There are two sections to the act. The first is the development of “programmable digital sovereign money,” or digital currency, which may be exchanged within a closed system. This would essentially let the Andorran state design it’s token.

The act’s second section refers to digital assets as financial instruments and aims to establish a framework for regulating distributed ledger and blockchain technology. According to Paul (who opted not to use his last name), the new rule may bring in new customers, including the CEO of the local bitcoin company 21Million. According to him, the goal is to entice new firms to establish themselves in the nation by providing some legal clarification that makes the process simpler and clearer. In addition, they view this as a strategy to draw businesses and talent to the new economy.

Notably, Andorra does not recognize cryptocurrencies or other digital currencies as legal currency, and there are no proposed exchange methods under the Digital Assets Act. Only the euro, the chosen currency of the European Central Bank, is granted such privilege. Nevertheless, Paul, a fervent Bitcoiner, continues to argue for the adoption of Bitcoin (BTC) in Andorra despite this:

Paul emphasized in a blog post that Andorra should embrace a Bitcoin standard by embracing Bitcoin as a reserve asset, mining Bitcoin using sustainable energy, and inviting Bitcoin-centric businesses worldwide.

The Digital Assets Act is a step toward “making cryptocurrencies a day-to-day reality,” according to national daily Diari d’Andorra. Paul claimed that the activity determines how “crypto-friendly” anything is from a commercial standpoint.

“No issue, I have a buddy here who operates a mining company, and power is inexpensive. The same applies if you provide financial counseling services: very accommodating with a low tax rate. Finding a bank to collaborate with you may be challenging if you wanted to operate an exchange, but the government wouldn’t mind.

Blockchain was listed as one of the top investment opportunities for the little nation of Andorra in an interview with Jordi Gallardo in May. It is unclear, however, if the minister was referring to research into distributed ledger technology, which is the foundation of blockchains, or Bitcoin, the most popular blockchain in the world.

Co-founder of StackinSat Josselin Tonnellier told Cointelegraph that there is a misunderstanding surrounding cryptocurrency, blockchain, nonfungible tokens, and Bitcoin. Surfin’ Bitcoin, a significant European Bitcoin conference, is hosted by StackinSat in Biarritz, France, which is close to Andorra and also houses the organization’s headquarters.

Regular Surfin’ Bitcoin attendee Paul verifies that the feeling and ambiguity are still there in Andorra: “The regulator doesn’t differentiate between ‘crypto’ and Bitcoin. As of yet, they haven’t been “orange-pilled.” The phrase “swallow the orange pill” refers to the moment when a newbie to Bitcoin starts to comprehend the fundamentals of the ground-breaking cryptocurrency.

Tonnellier stressed that although there is an increase in public awareness of digital currencies and technologies, there is still a danger of fraud and losses in the absence of the proper educational resources or regulatory frameworks: “According to a recent KPMG report, there are more French people exposed to ‘crypto’ than to the stock market […] It is well known that “shitcoinery” thrives in France.

Although there isn’t a list of “shitcoins,” they are tokens other than Bitcoin, which, in the opinion of its proponents, is in danger of going to zero. One of the most noteworthy shitcoins of 2021 was Squid Game Token.

In Andorra, Tonnellier argued that the nation is best suited to capitalize on emerging technology like Bitcoin. One of the few nations in Europe that is not under the control of the European Parliament is Andorra. It is analogous to Switzerland in many aspects, albeit on a smaller scale: “Andorra is highly appealing for businessmen due to its low tax, but Switzerland has a big head start in fostering the growth of activities surrounding Bitcoin and cryptocurrencies in general. This language of regulations, which governs Bitcoin and blockchain activity, may change in the upcoming years.

Andorra is one of the smallest nations in Europe, with a total area of less than 500 square kilometers. Yet, unlike many people who think Andorra is not a tax haven, the tiny nation ended banking secrecy in 2018. Even yet, taxes are far lower than in France or Spain’s close neighbors, and up to 20% of the country’s GDP comes from financial services.

Despite the fact that it is unknown which digital assets the government plans to control through the Digital Assets Act, the economically driven movement may assist in diversifying the Andorran economy and luring blockchain- and crypto-based businesses. Paul sees it as a step toward Andorra accepting Bitcoin.

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