They present the first report that analyzes the regulatory frameworks related to digital identity, blockchain and crypto assets in Latin America.
The research was prepared by the DIDI Project, an initiative of the IDB Lab and the NGO Bitcoin Argentina. How is the legal situation for this type of technology in Argentina and in the region?
According to a report presented by the DIDI Project (Digital Identity for Inclusion), promoted by the innovation laboratory of the IDB Group (IDB Lab) and the NGO Bitcoin Argentina, the promotion of the development of initiatives around digital identity, the blockchain technology and crypto assets, could benefit from regulatory reviews that create more conducive conditions , as is the case in other countries around the world.
The research, entitled “Blockchain regulation and digital identity in Latin America”, was published as part of the series “The future of digital identity” supported by IDB Lab and LACChain, the Global Alliance for the development of blockchain in Latin America Caribbean.
The report, which is the first published work on the matter, gives an account of the regulatory frameworks in the region and analyzes strategies to improve the legal conditions for the implementation of projects of this nature .
“DIDI Project has developed and implemented the first self-sovereign digital identity model in Latin America based on blockchain with the aim of reducing the informational asymmetry that affects people who work in informal environments, hindering their access to quality goods and services .
Given the possibility of expanding and transferring this project to other countries in the region, we are working on the preparation of this report that seeks to account for the status of the legal situation and develop a series of possible lines of work to promote this type of program ” said Javier Madariaga, director of the DIDI Project.
And he added: “In this sense, we recognize the need to review and improve the regulatory frameworks in the region so that it is possible to take advantage of the opportunities that technological advances offer to prosper in the empowerment of people in vulnerable conditions.
We want this document to serve as an input so that policy makers can make decisions based on reliable information in resolutions that contribute to a more inclusive society ”.
Likewise, Erika Molina, IDB Lab Specialist, remarked that the research work means “an extremely valuable contribution to the implementation and development of projects that, like DIDI, seek to improve the living conditions of the inhabitants of vulnerable neighborhoods.”
In this sense, he stressed that “the consolidation of reliable and relevant digital identities contribute to the social and financial inclusion of people. It is important to highlight that, with this self-sovereign digital identity model, the public administration continues to assume the central role in the identification of people, but now they can have control over their digital credentials and a greater guarantee over the privacy of their data. “
In Argentina, according to the report, “all the personal data of a person are part of their identity.” Given the Personal Data Protection law, “the natural person is the owner of the same”.
Likewise, according to the Digital Signature law, “there are no drawbacks in the use of electronic documents for the preservation of attributes of the identity of each user that are based on the standards of Decentralized Identifiers (DIDs) and Verifiable Credentials (VCs) developed by the W3C ”. These points align with the goals of a self-sovereign digital identity.
Regarding blockchain technology, the research highlights that in the country there is no “all-encompassing regulation” today, and remarks that “the only existing regulation is given by Decree 182/2019”, whose section related to this type of technology is pending its regulation.
Smart contracts are in a similar situation. Although Decree 182/2019 includes within its regulations the management of this type of contracts, “this point still lacks regulatory regulations to understand its scope”.
Regarding cryptocurrencies, such as Bitcoin, for example, the report shows that “there are different regulations” but these do not present uniformity in the terminology used. Outside of Resolution No. 300/2014, “there is no general classification of crypto assets” that can be used, “which does not contribute to unifying and clarifying the different terms used by the regulations.”
The research adds that this type of assets “could not be subsumed in the concept of currency, neither national nor foreign” and that, following the aforementioned resolution, it is possible to consider cryptocurrencies as means of payment “in the commercial operations of the people of voluntary acceptance ”. Finally, it states that, despite the fact that “there are currently no regulations in Argentina on electronic money,
“Regulation of blockchain and digital identity in Latin America” has Andres Chomzyck as its main researcher, who worked together with Javier Madariaga, DIDI Project Director at the NGO Bitcoin Argentina, Erika Molina, IDB Lab Specialist, and Marcos Allende Lopez, Specialist from the IDB and Technology Leader of LACChain.
The work also analyzes the legal situation in Bolivia, Brazil, Chile, Colombia, Costa Rica, Cuba, Ecuador, El Salvador, Guatemala, Haiti, Honduras, Mexico, Nicaragua, Panama, Paraguay, Peru, the Dominican Republic, Uruguay and Venezuela. In addition, it includes observations on other jurisdictions that are currently also working on the implementation of digital identity solutions.