On October 24th, the bill for the regulation of cryptocurrencies in Costa Rica, better known as the “Cryptoactive Market Law”, was presented in the Legislative Assembly. This proposal was put forward by deputy Johanna Obando, and it has had a great resonance in our country since we are finally going to have the long-awaited answer to the typical question: How do we regulate it?

We know that cryptocurrencies are like digital money. In other words, we can make any type of payment in a restaurant, buy a plane ticket, book hotels, among many other things, without cash, and with the advantage that it can be transferred to whomever we want in any part of the world.

The main cryptocurrency is currently Bitcoin, but it is not the only one, today there are already more than 10,500 cryptocurrencies traded in various markets around the world. Another of its advantages is that, as its word says, it is a digital asset that has a cryptographic encryption system, which guarantees the ownership of the cryptocurrency, ensures the integrity of the transactions, and prevents the creation of additional units.

The use of cryptocurrencies around the world has highly increased due to the advantages exposed and many others, but with this has also grown the need for many countries such as Costa Rica to regulate this matter and be able to answer the typical questions of How is it regulated? What is my tax situation? What is the coercive capacity of the State against this digital money?

With the project, they seek to answer these questions and establish a legal framework, since even though cryptocurrencies are not prohibited in Costa Rica, they lack legal regulation, therefore, they are seeking to provide legal certainty to the use and transfer of these digital currencies within the national territory. One of the purposes that we consider the most important of the project is that it expects to promote the country as an investment center for those who provide these currencies and thus promote economic reactivation, generate jobs, and promote the development of the country. It is also sought that we can make payments for goods and services with our digital wallet, however, this will not be the legal tender in the country.

We can find the following points reflected in the project:

• Important definitions and to whom the regulations apply.
• Detailed description of crypto assets and their different categories.
• Ownership of cryptocurrencies, their use, and responsibility.
• Rules for crypto assets providers and policies against money laundering.
• Tax issues, as well as aspects of capital gains and losses.

This last point is one of the aspects that generates the most concern in this matter and fortunately, this project in its chapter V regulates it, establishing that companies that provide crypto assets can settle in Costa Rica, and pay taxes like a normal company, but for individuals, the possession, use and transfer of crypto assets will not be subject to any tax obligation.

The implementation of this regulation in our country will bring many positive changes such as the security of transactions, the opening of jobs and investments, and tourism capital. And, with them, the need to have good legal and financial advice to be able to adapt to the cryptocurrency “world”. Many questions will arise regarding salary payments, banking issues, purchase and sale of properties, growth of national and international trade, tax issues, and payment of goods and services, among many others, and at ERP Lawyers, we offer you the best legal advice that you may require in any of these matters and others that are immersed in this great legislative change.

It is very important to always be advised and prepared for these changes that will affect not only the commercial world but also our daily lives. ERP Lawyers has a team of specialized lawyers and accountants willing to provide you with the best advice on the matter. Do not hesitate to contact us by email at info@erplawyers.com.