Brazil President Assents Crypto Legislation to Law

Jair Bolsonaro, the president of Brazil, has approved the whole crypto regulation bill that had just been passed by the Senate and Chamber of Deputies of that nation on Thursday without making any changes.

Brazil's President officially signs into law a bill legalizing crypto payments in the country

— Blockworks (@Blockworks_) December 22, 2022

On December 22, the official journal of Brazil reported that President Jair Bolsonaro signed the legislation into law, creating a comprehensive regulatory framework for Bitcoin trading and use as a payment tool in Brazil.

The law was passed by Bolsonaro and Congress without any further changes. As a result, Brazil has become one of the first nations in South America to formally accept Bitcoin as a means of payment and even an asset for investment.

The new law defined cryptocurrency as “a digital representation of value that can be negotiated or transferred electronically and used for payments or as an investment.” It further noted that “it will be incumbent upon a body or entity of the federal public administration, defined in an act of the Executive Branch, to establish which financial assets will be regulated for the purposes of this law.”

Cryptocurrency Companies in Brazil Must Seek Licensing

Following the president’s assent, cryptocurrency companies will have 180 days to adjust to the new regulations. The law establishes a “virtual service provider” license, which is required of businesses like exchanges and trade intermediaries.

These companies must also distinguish between user and corporate assets in accordance with the legislation. Some cryptocurrencies that qualify as securities will be governed by another, as-yet-undetermined organization, while others will be under the supervision of the Brazilian Securities and Exchange Commission (CVM).

Crypto Adoption Spreading Across South America

Despite the fact that the law does not make cryptocurrency legal cash as it does in El Salvador, it nevertheless represents a huge step forward for Brazil’s crypto sector, which is growing to become a hub for blockchain and digital assets.

The expansion in Brazil is mirrored by South America’s expanding acceptance of cryptocurrencies. Reports show that Argentina, a neighboring country, is currently the nation with the fourth-highest proportion of cryptocurrency ownership.