Panama Crypto License 2026 — Bill 697 and Regulatory Reality

What the Panama crypto license actually offers in 2026

Panama announced ambitious crypto-asset legislation in 2022. The National Assembly passed Bill 697 — the Crypto Asset Law — with broad provisions covering crypto-asset use as means of payment, tax treatment, and a Panama crypto license framework. International press described Panama as the next Latin American crypto hub for Bitcoin exchange operations and cryptocurrency-in-Panama infrastructure.

The Presidential veto in June 2022 changed the trajectory. President Cortizo vetoed parts of the bill citing AML/CFT concerns aligned with Panama’s broader effort to address FATF grey-listing issues. The vetoed text has not been re-enacted in amended form, and the dedicated CASP licensing framework Bill 697 envisaged remains in regulatory limbo as of 2026.

The operational reality is more limited than the headlines suggest. Panama crypto-firm operations in 2026 rely on three building blocks: AML registration through the Superintendence of Banks of Panama, general Panamanian corporate law for entity structure, and Panama’s territorial tax system for tax treatment. There is no dedicated Panama crypto licence operational.

For operators considering Panama, the right question is not “should we get a Panama crypto licence” — there is no dedicated licence available. The right question is whether Panama makes operational sense as a Latin-American-positioning base under the AML-registration framework that exists.

The Bill 697 trajectory

Bill 697 was introduced in 2021 and passed the National Assembly in April 2022. The bill provisions included:

Crypto-asset use. Recognition of crypto-assets as legal means of payment for private contracts (without designating crypto-assets as legal tender comparable to El Salvador’s Bitcoin framework).

Tax treatment. Specific tax provisions for crypto-asset transactions, capital gains treatment, and reporting framework.

CASP licensing framework. Dedicated licensing regime for crypto-asset service providers including exchanges, custodians, and related operators.

AML framework integration. Detailed AML obligations for crypto-asset operators aligned with international FATF standards.

President Cortizo issued the partial veto in June 2022. The veto cited concerns about AML/CFT compliance gaps in the bill text and asked the National Assembly to address specific deficiencies before re-enactment.

The amended text has not been re-enacted in operational form through 2026. Political and regulatory dynamics around the bill have continued but the bill has not produced an operational licensing framework. Bill 697 is best treated as a policy direction rather than an enacted regulatory framework.

What does work — the AML-registration framework

Panama crypto-firm operations in 2026 rely on the general Panamanian AML framework administered by the Superintendence of Banks of Panama (SBP). The framework operates under:

Law 23 of 2015 — Panama’s principal AML/CFT legislation, applying to financial-services institutions and designated non-financial businesses.

Law 124 of 2020 — recent updates to AML obligations including expanded coverage for designated business categories.

SBP implementing regulations — detailed obligations on customer due diligence, suspicious operation reporting, and ongoing AML programme requirements.

Financial Analysis Unit (UAF) reporting framework — the FIU receives suspicious operation reports and maintains the broader Panama AML intelligence framework.

Crypto-firm operations need to register with SBP under the applicable AML obligated-entity category, maintain a comprehensive AML programme with designated AML officer, conduct customer due-diligence appropriate to risk, report suspicious operations to UAF, screen against international sanctions lists, and undergo ongoing SBP supervisory engagement.

The framework is AML-focused rather than CASP-style. There is no prudential capital requirement equivalent to EU MiCA Annex IV, no dedicated CASP conduct supervision, no specific operational resilience framework. The framework is closer to the pre-MiCA EU AML-registration model than to full MiCA scope.

Substance and corporate structure

Panamanian corporate law provides the entity-structure layer for crypto operations. Common structures:

Panamanian Sociedad Anónima (SA). The standard Panamanian corporate vehicle. Panama-incorporated SA with Panamanian registered office, Panamanian resident agent, and corporate governance under Panamanian Corporation Law. Annual maintenance fees are modest. Director residency is not strictly required but is operationally helpful for AML registration.

Private Interest Foundation. Used for asset-holding or family-office crypto structures rather than operational crypto-asset business. Limited operational utility for active CASP-style operations.

Branch of foreign company. Foreign-incorporated companies can register Panamanian branches with appropriate registrations. Less common for crypto operations given the AML-registration framework typically requires Panamanian-incorporated entity.

Substance expectations under the AML framework are limited relative to EU jurisdictions. SBP looks for:

• Panamanian-incorporated entity with registered office
• Designated AML officer (Panamanian residence helpful but not strictly required)
• Substantive AML programme documentation
• Operational capability for customer due-diligence, transaction monitoring, and FIU reporting
• Audited financial statements

The substance bar is lower than EU MiCA, UK FCA, or Singapore MAS regimes. Operators with mature compliance infrastructure can establish Panama operations at substance-investment cost in the USD 75,000-200,000 first-year range.

When Panama makes strategic sense

For most CASP operators globally, Panama is not the right primary licensing jurisdiction. The framework lacks dedicated CASP scope, produces no EU or US passport access, and signals less reputational tier than EU/UK/US/SG credentials.

The cases where Panama makes strategic sense:

Latin American customer focus. Operators whose principal customer base is Latin American retail or institutional customers. Panama’s geographic and cultural positioning supports LATAM market reach in ways that EU or US bases do not.

Spanish-language operations with regional positioning. Spanish-language customer service, Spanish-language compliance team, and Latin-American-business cultural alignment. Panama is one of the natural homes for these operations.

Corporate-structure layer alongside primary licensing. Some operators use Panama as a corporate-structure layer (holding company, IP-holding entity, regional headquarters) while maintaining primary CASP authorisation in EU, UK, US, or Singapore. The dual structure produces tax optimisation and corporate governance benefits.

Pre-positioning for future Panama framework operationalisation. Operators expecting Bill 697 or a successor framework to operationalise in 2026-2028 may rationally build Panama presence now to be first-mover when dedicated licensing arrives. The build is real but the timing depends on the operator’s view of legislative timeline.

For operators where none of these scenarios apply, EU member-state CASP authorisation, UK FCA registration, US federal-plus-state stack, or Singapore MAS licensing produce stronger reputational and operational outcomes than Panama AML-registration.

Panama crypto license cost comparison — LATAM neighbours

How Panama compares to other Latin American crypto jurisdictions

Panama vs El Salvador. El Salvador adopted Bitcoin as legal tender in 2021 and has the most developed Latin American crypto positioning. El Salvador framework operates through the Digital Assets Law producing CASP-style licensing. For crypto-positioning operators with LATAM focus, El Salvador typically produces stronger signal than Panama.

Panama vs Brazil. Brazil operates the Law 14,478 (Crypto Asset Service Provider Law) effective from 2023 administered by the Central Bank of Brazil. The framework is more developed than Panama’s current AML-only approach. Brazil suits operators targeting the substantive Brazilian market specifically.

Panama vs Mexico. Mexico operates the FinTech Law including provisions for crypto-related Institución de Fondos de Pago Electrónico (IFPE) authorisation. Framework is well-developed for licensed digital-payment crypto operations. Mexico suits operators targeting the Mexican market.

Panama vs Argentina/Chile/Colombia. Each operates evolving crypto frameworks with varying degrees of regulatory development. Choose by specific country-customer focus.

Practical takeaways

Panama in 2026 is an AML-registration jurisdiction rather than a dedicated CASP licensing destination. Bill 697 has not produced an operational licensing framework. Operators considering Panama need to plan around what exists rather than what was announced.

Three principles for operators evaluating Panama:

Read Bill 697 status accurately. The bill is pending re-enactment, not operational. Marketing or consultant materials describing Panama as offering a CASP-equivalent licence overstate the regulatory reality.

Use Panama for LATAM positioning, not global passport. Panama produces no EU or US market access. The right role for Panama in a licensing strategy is Latin American customer focus or corporate-structure layer alongside primary licensing elsewhere.

Monitor framework development. Panama may operationalise dedicated crypto licensing in 2026-2028 through revised legislation or implementing regulations. Operators planning long-term Panama presence should monitor the development and adjust strategy as the framework matures.

For corrections, updates, or counsel referrals on Panama crypto operations, email [email protected].