Laos, a country located in Southeast Asia, has authorized the mining and trading of cryptocurrencies. This move will help the country profit from Chinese miners as they can be an option in Asia for those who have experienced repression in China.
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Green mining of cryptocurrencies
Many analysts said the move was a logical step for the country to take as it is known for producing surplus hydroelectricity, which will further make cryptocurrency mining green and green, while other analysts have warned that gangs criminals could try to profit from trading.
This move comes as a reversal as the country's central bank last month warned banks, businesses and residents against using cryptocurrencies.
The Prime Minister's office in Laos this week said six companies, including construction groups and a bank, have been cleared to begin mining and trading cryptocurrencies such as Bitcoin, Ethereum and Litecoin.
According to a report in the Laotian Times, government ministries will now work with the Bank of Laos and the national electricity company to regulate the sector. The results of the research and consultation are expected to be discussed at a government meeting later this month.
Covid has slowed tourism
The shift to cryptocurrencies comes at a time when the country has suffered significant losses in tourism revenue caused by the Covid-19 crisis. This in turn has also reduced the demand for hydroelectricity, a key industry in a country that has borrowed heavily to build dams on the Mekong River and its tributaries. This has led many to believe that the government could also promote cryptocurrency mining in other countries to create a new source of revenue as it seeks to repay nearly $ 14 billion in debt.
The government of Laos has promised to step up efforts to combat money laundering, after being scrutinized by the Financial Action Task Force, the United States and the United Nations Office on Drugs and Crime.
Zachary Abuza, a professor at the National War College in Washington who specializes in Southeast Asia, said: “You always have to worry when countries with poor regulatory records start getting involved in things like cryptocurrency. To say that the Laotian financial system is immature would be a brutal euphemism, and we need to worry if they are rushing into this ”.
Laos is home to 7 million people and has an abundance of green energy. The authorization not only gives a home to banned cryptocurrency miners in China, but also pushes the narrative that cryptocurrency mining is going green in the Asian region. This news bodes well for the cryptocurrency community and shows a strong and general acceptance of cryptocurrencies in our daily life.