The government of Laos has authorized six firms to trade and mine cryptocurrencies, ending a ban imposed in 2018, according to a recent notice from the prime minister’s office.
Fast facts
- Laos had implemented a complete ban on cryptocurrencies three years ago, including on trading and mining activities. As recently as last month, the country’s central bank issued a notice reiterating that cryptocurrencies were forbidden by law in the country, and that investors should be wary of the unregulated digital assets like Bitcoin and Ethereum.
- The latest notice, however, indicates the government has reconsidered its stance and is now mulling crypto regulation as part of a pilot program. The discussions on crypto regulation include ministerial departments, the central bank and other relevant organizations. The results are set to be presented at an upcoming meeting with the prime minister from Sept. 16-17.
- The six companies that have received the green light for crypto trading and mining are Wap Data Technology Laos, Phongsubthavy Road & Bridge Construction Co., Sisaket Construction Company Limited, Boupha Road-Bridge Design Survey Co., Ltd., Joint Development Bank, and Phousy Group.
- Laos is one of the poorest countries in the region after Myanmar and Cambodia, with a per capita gross domestic product of US$2,630 in 2020, according to World Bank data. However, the country is trying to become the “Battery of Southeast Asia” by building hydroelectric dams on the Mekong River. The government plans to boost its hydro power generation capacity to 24000 megawatts and export 80% of it by 2030.
- This would enable the country to tap into the cryptocurrency mining industry that is seeing an exodus from China due to strict ongoing crackdowns. Chinese miners are already moving to the U.S. as well as nearby countries like Kazakhstan. If Laos fully authorizes cryptocurrencies and boosts its hydropower generation capabilities, it might be able to attract miners looking to relocate since cheap electricity supply was one of the prime factors that had made China the crypto mining leader.