Is Crypto Legal in Panama? The 2026 Status of Bill 697 and New VASP Bills

Search "Panama crypto law" and you'll find years-old headlines announcing that Panama legalized Bitcoin. The real story is more complicated. As of October 2026, Panama has no dedicated crypto-asset law in force. Owning and trading crypto is not prohibited, and property purchases funded with crypto close in US dollars through the regular banking and legal system. Here's how we got here.

Bill 697: the law that never was

In 2021 Panama's National Assembly considered Bill 697, a broad framework to regulate the commercialization and use of crypto-assets. The Assembly passed the bill. In 2022 then-President Laurentino Cortizo partially vetoed it and returned it with objections. The Assembly then approved it "por insistencia" (overriding the objections), which sent the dispute to the Supreme Court.

On 6 June 2023, the Supreme Court plenary declared Bill 697 inexequible, meaning unconstitutional and unenforceable (Órgano Judicial, La Prensa). The Court's ruling focused on procedural grounds. Practitioner summaries explain that the Assembly had tried to reintroduce elements in a way the Constitution doesn't permit after a veto (Licentium). The result: the bill was never promulgated and never became law.

Timeline at a glance

Dates come from the sources listed at the end of this article. Where sources differ on exact days, we've kept to the month or year.

What's happened since: 2025–2026 bills

Crypto regulation hasn't gone away. As of mid-to-late 2026, several bills are working through the Assembly, according to legislative trackers and practitioner reports (Licentium, LeyClara, Chambers):

• Bill 247 of 2025, a crypto-asset framework that has been in first-debate review in subcommittee since late 2025
• Bill 326 of 2025, aimed at an anti-money-laundering framework for virtual asset service providers (VASPs), also in subcommittee
• further related proposals, including fintech-oriented bills introduced in 2025–2026

None had become law as of the latest sources we reviewed. Bills can stall, merge or change substantially, so treat any predicted timeline with caution. We'll update this article as things move.

Panama City's crypto payments for municipal fees

Separately from national legislation, the Municipality of Panama took a practical step in 2025. Its municipal council approved letting taxpayers pay certain municipal taxes, fees and permits with crypto-assets: Bitcoin, Ether, USDC and USDT. A partner bank receives the crypto and converts it into dollars, so the city itself receives dollars (Municipio de Panamá, La Prensa).

That model, crypto accepted at the edge and dollars settled in the system, is essentially how crypto-funded property purchases work too.

AML: Panama's reputation has improved

For buyers worried about banking friction, two milestones matter:

• In October 2023, the FATF removed Panama from its list of jurisdictions under increased monitoring, the so-called "grey list" (FATF).
• In July 2025, the European Commission updated its list of high-risk third countries and removed Panama, among others (European Commission).

Panama's anti-money-laundering law (Law 23 of 2015) covers real estate professionals, including promoters, agents and brokers, as reporting entities (Law 23 of 2015). That's one reason any serious crypto-funded deal involves thorough KYC and source-of-funds checks (see our KYC guide).

What this means if you're buying property

• Crypto is a source of funds, not the closing currency. Expect to convert to USD through a regulated exchange or OTC desk.
• Your lawyer is essential. Without a specific crypto statute, the general civil, banking and AML rules govern your deal.
• Documentation beats ideology. Banks and notaries accept crypto-origin money when it's traceable.
• Watch for change. If a VASP law passes, licensing and reporting rules for crypto service providers could shift. The fundamentals of property law are unlikely to change overnight.

How banks and notaries see crypto money today

Without a dedicated statute, each bank sets its own risk appetite for funds that came from exchanges. In our experience, which isn't a legal opinion, the deciding factor is rarely "is this crypto?" It's "can we see where this came from?" A buyer who arrives with exchange statements, wallet histories that connect to those statements, and a clear explanation of how the coins were originally acquired is in a completely different position from one who can't explain a large transfer.

Notaries and the Public Registry deal with the property side: the deed, the identity of the parties and the price in dollars. They aren't the place where crypto questions get resolved. That happens earlier, at the bank and with the lawyer. So the practical legal question for most buyers isn't "is crypto legal?" It's "is my funds trail strong enough for the bank that will receive the money?"

If you're unsure, that's exactly what a first consultation is for. We'll look at how your crypto is held and introduce you to a crypto-friendly lawyer who can tell you what the receiving bank is likely to ask for.

A note on this article

This is a summary of public sources as of October 2026, written to help buyers ask better questions. It is not legal advice, and laws can change quickly. For a decision about your purchase, consult a Panamanian lawyer. We're happy to introduce you to crypto-friendly firms. Continue with how to buy with Bitcoin or our tax explainer.

Frequently asked questions

Sources

Sources checked Oct 29, 2026. Laws, regulations, thresholds and prices change. This article is general information, not legal, tax or financial advice. Confirm current rules with a licensed Panamanian lawyer and your tax adviser.

1. Órgano Judicial de Panamá: Fallo de 6 de junio de 2023, declara inexequible el Proyecto de Ley 697 de 2021
2. La Prensa Panamá: La Corte Suprema rechaza el proyecto sobre criptoactivos; es inexequible
3. Licentium: Panama VASP/PSAV law status (as at August 2026)
4. LeyClara: Proyecto de Ley 247 de 2025, legislative status
5. Chambers and Partners: Blockchain & Crypto-Assets 2026, Panama: Trends and Developments
6. Municipio de Panamá: Consejo Municipal aprueba uso de criptomonedas para pagos municipales
7. La Prensa Panamá: Así funcionará el pago con criptomonedas anunciado por Mayer Mizrachi
8. FATF: Jurisdictions under Increased Monitoring, 27 October 2023 (Panama removed)
9. European Commission: Protecting the EU's financial system, high-risk list update (16 July 2025)
10. Superintendencia de Bancos: Law 23 of 2015 (AML/CFT), English version