Brazil’s Central Bank to Regulate Crypto Sector: President Lula

• Brazil’s Central Bank will have jurisdiction to regulate the local cryptocurrency sector.
• Companies offering digital asset services must obtain permission from the central bank and follow anti-money laundering procedures.
• The partnership with Brazil’s Securities and Exchange Commission (CVM) will oversee coins deemed as securities.

Brazil Empowers Central Bank as Crypto Regulator

The President of Brazil, Luiz Inácio Lula da Silva, recently signed an official decree that empowers Banco Central do Brasil to supervise the domestic cryptocurrency industry. This legislation comes into effect on June 20th, granting the financial institution jurisdiction to determine which firms can operate in the local market.

Central Bank Licensing System for Crypto Providers

Companies willing to offer digital asset services must obtain permission from Banco Central do Brasil and register under a licensing system set by the institution. This also includes monitoring anti-money laundering procedures and any criminal activities, such as terrorism financing.

Partnership with Brazilian Securities and Exchange Commission

Brazil’s Securities and Exchange Commission (the Comissão de Valores Mobiliários or CVM) are partnering with Banco Central do Brasil to oversee coins classified as securities. The agency is playing a role in regulating cryptocurrencies labeled as security tokens in order for them to be used legally in Brazil’s crypto market.

Enforcement Date

The new regulations come into effect on June 20th, giving all participants enough time to make sure they are compliant before enforcement begins. Once enforced, companies operating within Brazil’s crypto sector must adhere strictly to all rules set by both entities in order remain active within the market.

Conclusion

As of June 20th 2021, Banco Central do Brasil has been assigned full authority over Brazil’s cryptocurrency sector while CVM is allowed to supervise coins classified as securities within this space. All parties involved should ensure they are compliant with all rules enforced before this date or risk being removed from their respective markets indefinitely