Brazil may become the largest regulated market for crypto assets in Latin America

Brazil may become the largest regulated market for crypto assets in Latin America. After the Senate, Economic Affairs Committee unanimously approved one of two bills regulating the trading of Bitcoin and other cryptocurrencies.

The discussion of the regulatory framework for Bitcoin and other cryptocurrencies in Brazil comes amid the growing use and interest in these currencies in the country.

The proposal submitted by Senator Iraja Abreu will now go to the House of Representatives where it is expected to debate, and merged with another bill proposed by legislator Orio Ribeiro last year. They will meet to agree to present one text that reflects the spirit of the two proposals.

The bill, approved by the Senate on Tuesday, was prepared jointly by the central bank, the Securities Commission (CVM), and Brazil’s Federal Ministry of Revenue, com.Globo reported.

Senator Iraga, an ally of President Jair Bolsonaro, said in Congress: “Our goal with this regulatory framework is to revitalize the business environment, not stifle it.”

It seeks to “create mechanisms that can protect quality investors, individuals and legal entities, liberal professionals, and the self-employed, who see an investment opportunity within a clearly favorable business environment.”

He also stressed that if the two projects succeed in merging and with the approval of the Brazilian Congress, the issuance of a law regulating the cryptocurrency market in the South American country will be compatible with the Presidency of the Republic.

On the other hand, President Bolsonaro Jair is not entirely enthusiastic about Bitcoin. He has stated on several occasions that he knows nothing about cryptocurrencies. There is no certainty yet that the Brazilian leader will sign the regulation law if he reaches it in its final stage.
According to the approved bill, crypto companies already operating in the country’s financial market will have a minimum period of six months to adapt to the new rules.

 

What does the new law say?

The new bill states that “the penal code includes a specific crime related to cryptocurrency fraud and penalties for unauthorized service providers.” The federal government will manage and direct the regulation and direction of digital financial services, within the framework of free enterprise and free competition.

The adopted law also states that “information security and protection of personal data must be ensured by companies that engage in cryptocurrency trading.” All operations in the virtual asset market will be subject to the rules of the Consumer Protection Act.”

It is worth noting that taxpayers in Brazil, during 2021, made payments worth 7.200 billion Brazilian reais in cryptocurrency transactions, slightly more than double the amount recorded in the previous year, according to the local press.

Additionally, the number of people entering into digital money transactions has increased. The average number of investors per month increased from 125,000 in 2020 to 459,000 per month in 2021.

These broad discussions revolve around a final and comprehensive regulatory framework for the crypto market in the country with the largest economy in Latin America, at a time when Brazilians are so interested in using cryptocurrencies that they have become a reality that must be dealt with with whether everyone accepts it or not.