The Paraguayan government will ask lawmakers to approve a bill that would impose up to 10 years in prison for illegal Bitcoin (BTC) miners.
Presidential Spokesperson Paula Caro told reporters on Friday, May 17, that the government sent the bill to Congress “as a matter of urgency.”
10 years in prison: Illegal Bitcoin miners face even longer prison sentences
Caro said the bill aims to “punish” illegal miners with “multiple years in prison.”
The bill would also allow Paraguayan police and prosecutors to seize mining equipment from illegal operators.
According to Criptonoticias, Caro also said that the bill “aims to protect the state-owned National Electricity Authority (ANDE).”
She added that “massive energy theft by illegal Bitcoin mining operators” poses a “threat” to ANDE.
A provision in the bill allows courts to impose a “maximum penalty” of 10 years in prison for “the crime of energy theft.”
The proposal also allows ANDE to ask police to seize mining rigs and sell them to state-owned companies as “beneficiaries of the proceeds.”
Paraguayo's electricity company holds illegal Bitcoins. Hello, President Ehecutivo, President Paula Caro, announces the declaration of a state of emergency… pic.twitter.com/Tbt7MVKby7
— Joaquín Morinigo🇵🇾🏴☠️⚡️ (@criptoboi) May 17, 2024
Bitcoin mining is booming in Paraguay, where lawmakers are fighting to bring it into the legal realm.
The country has vast power resources that BTC miners find ideal: surplus hydropower energy.
But in recent years, a number of Paraguay-based miners have attempted to establish illegal connections to the power grid.
And power companies complain they are facing overloads and other problems.
Police responded by launching a crackdown. Since the beginning of this year, officers have arrested more than 5,000 ASIC miners.
Crackdown: Illegal Bitcoin miners face police action
Since the beginning of 2024, ANDE has participated in approximately 17 raids on illegal BTC and altcoin mining farms across the country.
As a result, Congress became more active. At least 14 lawmakers supported a private lawmaker's bill that would effectively ban Bitcoin mining in the country.
The bill proposes to “temporarily” block BTC mining “until the issue of illegal mining is resolved.”
However, the bill has not yet passed the committee stage and it is not certain whether it will reach the House for a vote.
If the government passes its own bill, the private lawmaker's bill is likely to be shelved.
Paraguay's central bank kept its benchmark interest rate unchanged at 6%, citing heightened uncertainty over oil prices and the timing of U.S. interest rate cuts. https://t.co/nUW8lF2fSW
— Bloomberg Markets (@markets) April 22, 2024
Caro said the government's bill has the support of the Ministry of Public Affairs, ANDE and the Paraguayan judiciary.
She concluded that illegal BTC mining had caused Paraguay's power company “millions of dollars worth of losses.”
