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Andorra Cryptocurrency & Blockchains Laws

Regulation of Digital Currencies: Cryptocurrency, Bitcoins, Blockchain Technology

In 2021, the Andorran Parliament took concrete steps to address digital currency and related technology. [1] The Andorran Parliament in 2020 announced Horitzó 23. This legislative package seeks to address the ongoing consequences of the COVID-19 pandemic. [2] The plan includes 77 proposals divided into three pillars: welfare and social cohesion, the economy and innovation, and alliances for exchange. [3] Notably, Horitzó 23 emphasized the digital economic transformation by addressing the emergence of cryptocurrency and blockchain technology. [4]

To do so, one of the measures proposed a modification of Law 35/2014. [5] Passed on November 27, 2014, Law 35/2014 regulated a variety of electronic services that require trust, including electronic signatures and seals, certifications of authentication, and electronic delivery services and time stamps. [6] In essence, the Government sought to classify blockchain as an electronic trust service in Andorra. Legislators sought to modify the law through Horitzó 23 for two reasons. First, as Andorra begins the process an Association Agreement with the European Union, it is important that Andorra adapt the norm and regulatory framework of the European Union. [7] Second, the continued emergence of distributed registration technologies—like Blockchain—necessitates legal modification. [8]

Electronic Trust Law

The amendment to the Electronic Trust Law modified several provisions and added six new articles. [9] For example, Article 3 added pertinent definitions related to block-chain and Distributed Ledger Technologies (DLT) broadly. [10] Specifically, it defined a block as an “aggregate and immutable unit of data using distributed ledger technology, which consists of a collection of transactions, made in a specific period of time, with a block header, a hash of the previous block header, and a Merkle tree.”

Additionally, Article 5 outlined the legal effects of the electronic identification of a natural person. [11] Subsection (3) notes that electronic authentication involving a natural person will have the same effect as if the person used corresponding official documents. [12] Subsection (4) grants the Government regulatory authority to define levels of security for electronic identification and authentication and to establish standards relating to these levels of security. [13] Article 7 mirrors Article 5 but extends its application to the electronic identification of a legal person. In these cases, electronic authentication will have the same effect as if done by the representative of the legal person with respect to corresponding official documents. [14]

Ultimately, the amendment supports the issuance of local and international digital assets. [15] Further, this regulation is important in creating the stable regulatory framework necessary to attract investment and to create a stock market through blockchain in Andorra. [16]

The Andorran Government signed the modification on April 29, 2021, and the modification went into effect once it was printed in the Official Bulletin on May 19, 2021. [17] A direct result of the law is that cryptocurrency now have legal value and are both reliable and usable in Andorra. [18]

Beyond the modification of Law 35/2014, the Government discussed the creation of a license to be administered by the Andorran Financial Authority (AFA). [19] This license would allow entities to operate using crypto-assets. [20]

Is cryptocurrency legal in Andorran?
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[1] https://www.advantia.ad/en/blog/economics/blockchain-andorra/

[2] https://www.govern.ad/cap-de-govern/item/11746-el-govern-presenta-horitzo-23-el-pla-d-accio-per-a-la-resta-de-la-legislatura

[3] https://www.govern.ad/cap-de-govern/item/11746-el-govern-presenta-horitzo-23-el-pla-d-accio-per-a-la-resta-de-la-legislatura

[4] https://www.advantia.ad/en/blog/economics/blockchain-andorra/

[5] Llei 9/2021, del 29 d’abril, de modficació de la Llei 35/2014, del 27 de noviembre, de serveis de confiança electrònica (Llei 9/2021) (Andorra).

[6] Cryptocurrencies and bitcoin in Andorra , Andorra Insiders, https://andorrainsiders.com/en/blockchain-cryptocurrency-bitcoin/ (last visited May 24, 2020).

[7] Llei 9/2021, del 29 d’abril, de modficació de la Llei 35/2014, del 27 de noviembre, de serveis de confiança electrònica (Llei 9/2021) (Andorra).

[8] Llei 9/2021, del 29 d’abril, de modficació de la Llei 35/2014, del 27 de noviembre, de serveis de confiança electrònica (Llei 9/2021) (Andorra).

[9] Llei 9/2021, del 29 d’abril, de modficació de la Llei 35/2014, del 27 de noviembre, de serveis de confiança electrònica (Llei 9/2021) (Andorra).

[10] Llei 9/2021, del 29 d’abril, de modficació de la Llei 35/2014, del 27 de noviembre, de serveis de confiança electrònica (Llei 9/2021) (Andorra).

[11] Llei 9/2021, del 29 d’abril, de modficació de la Llei 35/2014, del 27 de noviembre, de serveis de confiança electrònica (Llei 9/2021) (Andorra).

[12] Llei 9/2021, del 29 d’abril, de modficació de la Llei 35/2014, del 27 de noviembre, de serveis de confiança electrònica (Llei 9/2021) (Andorra).

[13] Llei 9/2021, del 29 d’abril, de modficació de la Llei 35/2014, del 27 de noviembre, de serveis de confiança electrònica (Llei 9/2021) (Andorra).

[14] Llei 9/2021, del 29 d’abril, de modficació de la Llei 35/2014, del 27 de noviembre, de serveis de confiança electrònica (Llei 9/2021) (Andorra).

[15] https://www.advantia.ad/en/blog/economics/blockchain-andorra/

[16] https://www.advantia.ad/en/blog/economics/blockchain-andorra/

[17] http://www.consellgeneral.ad/ca/activitat-parlamentaria/lleis-aprovades/llei-9-2021-del-29-d2019abril-de-modificacio-de-la-llei-35-2014-del-27-de-novembre-de-serveis-de-confianca-electronica

[18] https://andorrainsiders.com/en/blockchain-cryptocurrency-bitcoin/

[19] https://www.advantia.ad/en/blog/economics/blockchain-andorra/

[20] https://www.advantia.ad/en/blog/economics/blockchain-andorra/

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Posted by Jack Read more Comments (15) 2021.08.14 05:56