Green Light to Cryptocurrency Payments from Brazil
Brazil's Chamber of Deputies has approved the bill titled “(PL) 4.041/2021” (Bill) regulating the cryptocurrency industry in the country. Once the Bill enters into force, all cryptocurrencies, including Bitcoin, will be able to be used as a means of payment in the country. In this context, cryptocurrencies will also have the status of investment instrument. However, it should be noted that the Bill does not grant official currency status to cryptocurrencies.
The fundamental regulation in the Bill is the license requirement. In this context, cryptocurrency companies must obtain a virtual service provider license to operate. In this way, it is aimed to strictly regulate companies operating as crypto money service providers in the country. Bill also imposes imprisonment and monetary fine as a penalty to those who commit fraud with virtual assets.
The Bill approved by the Chamber of Deputies also envisages establishment of a body to oversee the cryptocurrency industry. In this regard, the expectation is that the use of cryptocurrencies in payment transactions will take place under the supervision of the Brazilian Central Bank.
The final step for the implementation of the Bill, which is seen as a significant step in the adoption of cryptocurrencies in Latin American countries, is the approval of the president. Then, it is expected that companies will have 180 days to adapt to the new rules. In this period, when we witness that the regulatory work accelerates in order to draw the legal framework for crypto assets in the world, the legislation in Brazil is also extremely crucial.