Costa Rica’s technology ecosystem is moving towards the final legal framework with the preparation of the first draft of the Framework Law on Digital Sovereignty and Emerging Technologies. This is an initiative that aims to implement the regulation of virtual currencies in the country and establish a regulatory foundation for service providers.
This regulation constitutes a structural national proposal aimed at creating the rules of the game for the techno-economic, asset tokenization (RWA), digital mining, payments, custody, staking and general development of the virtual currency sector in the territory of Costa Rica.
The project was prepared by Costa Rican lawyer Stephanie Sanchez and is in the preliminary stages of technical and social consideration. The document is in a period of consultation and interagency exchange until June 15 next year.
During this period, various public and private sectors from Central American countries can submit their opinions. To strengthen the conceptual maturity of the draft. before its formal introduction in the Legislative Assembly.
Determinants such as the rise of decentralized accounting technologies, the need for sovereign digital infrastructure, and the urgency of establishing interoperability mechanisms with international standards This motivated the drafting of this general regulatory framework tailored to the Costa Rican context.
In contact with CriptoNoticias, Sánchez emphasized that the aim is to introduce Bitcoin into the Costa Rican constitution, and that the proposal focuses on a thorough institutional modernization of state capacity, rather than sectoral benefits.
In general, the project aims to protect countries and users from the economic risks implied by the absence of any clear rules (a scenario that usually leads to investment flight). And there is a technological lag compared to other countries on the continent.
After the technical consultation, which ends on June 15, the draft will be submitted to the Legislative Assembly, where an expert committee will make a decision within 30 working days. At this stage, The consulted agency will have eight business days to provide its findings. Substantive motions may then be proposed to amend the text.
The project will then be debated twice in plenary session on different days. Between the two votes, at least 10 members can discuss constitutionality in the fourth chamber, which halts the process. Approval was obtained at the second debate, and finallysent to the executive branch for sanctions and publication. gazette.
CriptoNoticias reviewed Sanchez’s bill and highlighted five key points:
The first fundamental axis of the draft system focuses on the creation of Costa Rica’s National Commission for Digital Assets and Emerging Technologies (CNAD-CR). This committee is an organization designed to function with professional technical intent. It is intended solely for the supervision of decentralized industries.
This new organizational structure aims to resolve the lack of public supervisors with sufficient technical capacity to investigate the complex operations characteristic of issuers and service providers dealing with all types of digital assets at the local level.
This technical proposal focuses on delimiting the operational boundaries of the new organization to avoid jurisdictional conflicts and legal duplication within Costa Rica’s national organizational chart.
Sánchez’s draft policy explicitly provides that the expert committee will not be replaced under any circumstances. Constitutional powers of the Central Bank of Costa Rica Regarding monetary policy, it will not undertake traditional banking supervision duties comparable to existing supervisory institutions.
Instead, its legal nature is defined as a technical subsidiary. Providing regulatory guidelines and expert support to courts and ministries In complex matters such as the prosecution of financial crimes of a technological nature.
Among the priority functions assigned to this technology division are the authority to coordinate general public policy related to the digital economy, the development of rigorous technical standards, and the promotion of the country’s global economic competitiveness.
The draft law also provides authority to manage regulatory testing environments, commonly referred to in the industry as “test environments.” sandboxnational and international technology companies will be able to test their products and developments in a controlled market before mass commercialization.
At the governance level, the expert committee acts as the authority responsible for assessing the institutional impact of the technology and recommending subsequent regulatory updates to relevant ministries.
2. Step-by-step legislative architecture
This proposed regulation is not intended to cover all variables in the technology and financial industries in a single broad document; It proposes a legislative strategy of a gradual nature.
This progressive implementation model accommodates a division of functions that reduces the burden on Congress and distributes regulatory authority according to the nature of the problem.
In practice, the Ministry of Science, Innovation, Technology and Telecommunications will take the reins in defining the country’s technology infrastructure and logical security policies, while the General Authority for Financial Institutions will retain the authority to dictate prudential regulations against money laundering that apply to traditional financial service providers that interact with the crypto industry.
Meanwhile, the executive branch, through its trade portfolio, will develop incentives to attract global investment in high-tech sectors.
The draft law defines itself as law number one in the country’s digital sovereignty regulatory ecosystem. That is, its sole purpose is to lay the institutional foundations, declare general legal principles and establish the foundations of digital rights for the citizens of the Republic of Costa Rica.
This progressive implementation model accommodates technical justifications aimed at reducing the complexity of parliamentary debates within the Legislative Assembly.
By separating basic institutional principles from the highly technical regulations required by other specific sectors, Sanchez seeks to avoid the phenomenon of overregulation that often makes technology law obsolete. Several months after official promulgation This is because the speed of global technological development is fast.
The proposed basic framework assumes that legal flexibility is a requirement for the survival of modern law.
Through this step-by-step approach, regulators can adapt secondary regulations to changes in international markets. There is no need to leave the text to the parliamentary reform process.ensuring a harmonious evolution between the needs of the technological market and the constitutional obligations of the state.
A key aspect of this economic proposal is seen in the design of the National Fund for Digital Sovereignty and Innovation, a financial instrument conceived as a strategic reinvestment mechanism. Strengthen the country’s digital production equipment.
According to the article, the fund will collect a certain percentage of state revenues directly derived from the activities of companies in the digital economy and decentralized industries.
According to the text, this fund has no independent taxation or taxation rights. Allows discretionary management of resources It is outside the traditional control of the Comptroller. Furthermore, it indicates that the collection of related taxes will continue to be carried out under the strict guidance of the Costa Rican Treasury channel.
Similarly, it is provided that the economic resources accumulated in this fund will only be used to finance projects classified as having high national strategic priority.
Priority areas for investment include optimizing the national cybersecurity system, investing in critical digital infrastructure such as national data processing centers, advanced training of local technical talent, and funding research projects in artificial intelligence applied to Costa Rica’s public sector.
This budgetary rigidity makes it a notable difference from the economic management models practiced in other countries in the Central American region, such as El Salvador.
While El Salvador’s government is injecting resources from initiatives related to digital assets directly into aid projects, Costa Rica’s proposal leans toward a closed-circuit model that leverages the wealth created by technology. only reinvested into the same technology infrastructure that produced it.
4. Strategic delimitation of Bitcoin’s role in the economic order
This institutional document devotes a significant portion to establishing the country’s position on the global geoeconomic phenomenon represented by Bitcoin (BTC).
This proposal clearly recognizes the importance of this decentralized digital asset in modern international markets. Nevertheless, Clearly demarcate the scope of operation It is located within Costa Rica’s borders to maintain neutrality with the existing banking system.
The bill makes clear in its fundamental principles that this regulation does not contemplate establishing Bitcoin as a legal tender in the country under any circumstances.
Costa Rica’s colon remains as the only official monetary unit Economic actors and the general public will not be forced to use decentralized digital assets to accept payments or settle contractual obligations unless they expressly wish to do so.
Despite excluding the obligation to use digital currencies, the document legally enables central banks to develop technical analysis and research. To assess the long-term feasibility of incorporating strategic digital assets within the national reserve organization.
Similarly, this project aims to provide the necessary rules so that traditional financial institutions can develop secure interoperability channels with decentralized markets, while always strictly adhering to banking guidelines.
This pragmatic stance seeks to avoid the risks associated with digital currency price fluctuations while leveraging the underlying technological advantages of digital currencies.
By eschewing the fiat currency system and leaning towards a model of strategic awareness and informed free adoption, this project Aiming to attract top-level financial institutions Storing or operating assets of this type within Costa Rican territory requires contractual clarity.
5. Incorporation into international competitiveness standards
The final focal point of the project is to define Costa Rica’s insertion strategy within the dominant regulatory currents in the most developed jurisdictions of the world economy.
The drafters have incorporated explicit references from the European Union’s MiCA law, the guidelines of the Dubai Virtual Assets Regulatory Authority, and regulations in force in Singapore and El Salvador.
The stated purpose is to harmonize the rules of the internal market It meets the technical requirements demanded by large international capitals.
This system proposal clearly states that the country firmly rejects the use of regulatory arbitration as a means of attracting business. Denying the possibility of becoming a speculative financial haven or in permissive areas where transactions are opaque.
On the contrary, this document is premised on a commitment to require all industry participants to strictly adhere to the Financial Action Task Force (FATF) recommendations against money laundering and terrorist financing.
The draft also contemplates the adoption of the international financial standard ISO 20022 to ensure transactions and data messaging related to national decentralized industries. Fluid integration without technical friction We work with traditional banking networks in major Western countries.
This technological compatibility is essential for the export of digital services and the objective of attracting critical infrastructure promoted by the country’s Ministry of Foreign Trade.
Proponents of this legal initiative conclude that timely regulation in this area should cease to be recognized among government officials. As a source of financial risk And it is beginning to be interpreted as a strategic necessity to guarantee national sovereignty.
Impact on the adoption of cryptocurrencies in Costa Rica
If the Framework Law is finally approved by the Costa Rican Congress, it will have a dual impact on the local cryptocurrency ecosystem. From a favorable perspective, the establishment of a stable legal structure may provide the contractual security needed by traditional large corporations and foreign investors. Establish large-scale operations within the country.
Additionally, having a clear definition of the legitimacy of asset ownership and self-custody will reduce users’ risk of arbitrary interference by the commercial banking system, facilitating economic integration and the flow of legal capital to local technology-based businesses.
However, disadvantages still exist. Regulatory framework in line with international financial supervisory standards and FATF disciplinary guidelines May create significant barriers to entry For small users and independent developers.
This is because the emphasis on transaction oversight and the obligation to adhere to strict customer identification processes may limit the decentralized and free access nature that is inherently characteristic of Bitcoin technology.
Therefore, if derived regulations are overly bureaucratic or costly to implement for local small businesses; Costa Rica will risk stifling domestic innovation It favors large, licensed foreign conglomerates and slows the growth of everyday crypto usage among the unbanked.
(Tag translation) Bitcoin (BTC)
