Panama is at the est of a transformation in its financial market with the possible regulation of cryptocurrencies and the tokenization of assets, according to specialist Alfredo Muñoz.
In the conversation “Approximation to the Regulation of Digital Assets in Financial Markets”, held this week, Muñoz highlighted that regulation promises to revolutionize the management of financial assets.
“The regulation of digital assets in the Panamanian financial market is on the horizon,” he said, indicating that this measure seeks to take advantage of the technology inherent in Bitcoin to improve the efficiency and speed of transactions.
Muñoz explained that the tokenization of assets allows almost instantaneous settlements, which is a leap compared to the days that traditional methods usually require.
“The implementation of distributed networks not only optimizes the speed of settlements, but also allows investors to exercise all their rights in a programmed manner,” he said.
In his opinion, the benefits of this regulation are clear: greater supervision, efficiencies for investors and democratized access to the market.
“Tokenization also generates greater liquidity exchanges by automating settlements, allowing investments to be customized according to the characteristics of each user,” Muñoz said.
With this upward trend, Panama could position itself to lead financial innovation in the region, says Muñoz. “Panama has always been advanced in the financial market; it is time to give a boost to the regulations to recognize and test this technology,” he said.
The need to regulate, according to the FATF
In opinions similar to those of Muñoz, Sergi Lucas, president of the Panamanian Capital Markets Association (Apamec), stressed the urgency of regulating digital assets, aligning himself with the recommendations of the International Financial Action Task Force (FATF).
“We will have to do it, hopefully Panama will make the determination to regulate it with a vocation to take advantage of it and do business,” Lucas said, pointing out that Panama could be losing opportunities by not properly interpreting the reality of cryptocurrencies while other nations advance.
Currently, Panama is in a regulatory limbo since in 2023 former President Laurentino Cortizo vetoed the Crypto Law that sought to regulate the sector. The Supreme Court of Justice of Panama will have the last word, although so far there has been no news.
Even with this scenario of regulatory uncertainty, Panama is one of the countries most prepared to adopt assets such as bitcoin, according to a survey conducted at the end of 2023 by the company Forex Suggest, as reported by CriptoNoticias.
In addition, Panama is not only a candidate for the adoption of cryptocurrencies, but also has financial institutions that have already begun to offer products and services with bitcoin. This is the case of TowerBank, which has its own platform to operate with these assets. The above reinforces Panama’s position as a fertile ground for financial innovation based on cryptocurrencies.
We already have a permissionless, unregulated, decentralized crypto-currency in bitcoin. We don’t need no stinking government regulated CBDC tokens. This proposed regulation has control, taxation and WEF written all over it.
The private sector has solved the destructive problems of central bank fiat currency, there is no need to test a new experimental Panamanian model when all that’s required is for the government to just get the hell out of the way.