The Brazilian House of Representatives approved a bill regulating the cryptocurrency industry on Tuesday. On the other hand, it was decided to use cryptocurrencies as a payment method. Here are the details…
Law designed for cryptocurrency transactions gets approval
The bill, which was approved in the Senate in April and was submitted to the House of Representatives, now needs the approval of the executive branch to become law. The bill, written by MP Aureo Ribeiro, establishes a new fraud offense involving crypto assets with a penalty of between two and six years plus a fine. It also requires the creation of a “crypto service provider” license, which will be requested by companies, including exchanges and other crypto firms.
According to the text, companies will have 180 days to comply with the new rules before the law takes effect. The text stipulates that crypto assets that are considered securities will be regulated by the Brazilian Securities and Exchange Commission (CVM), while other crypto assets that do not fall into this category will fall under the responsibility of another body appointed by the executive branch. It is expected that the Central Bank of Brazil will be elected in this direction.
Cryptocurrencies become legal as payment
Brazil, on the other hand, passed a law legalizing cryptocurrencies as a means of payment nationwide. It provided a regulatory boost to the adoption of cryptocurrencies and the expansion of the ecosystem. The Brazilian House of Representatives has approved a regulatory framework legalizing the use of cryptocurrencies as a means of payment in the country.
The document, signed under the code PL 4401/2021, provides for the inclusion of cryptocurrencies and airline frequent travelers rewards (miles) in the definition of “payment agreements” under the supervision of the country’s Central Bank. The law, which has already been passed and requires only the signature of the President to take effect, gives legal status to payments made in cryptocurrencies for goods and services. But it does not give them legal currency status.
Brazil has many crypto ETFs
Brazil has made significant progress in terms of cryptocurrency regulation and adoption among investors. As we have also reported as Kriptokoin.com, it is currently the country with the most crypto ETFs in Latin America. Also, most of the country’s major banks and brokers are currently offering crypto investments or services such as custody or token offerings. Even Itaú, one of Brazil’s largest private banks, is trying to tokenize assets as part of its suite of services for future investors.
Once the law comes into force, it will be up to the executive branch of government (president and ministers) to determine the agency or office tasked with overseeing the matter. Only tokens classified as securities fall under the jurisdiction of the CVM, i.e. Brazil’s SEC.
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