Brazil's President Luiz Inácio Lula da Silva has signed new legislation into law specifying jurisdictions on crypto to provide clarity within the Brazilian digital asset industry. The legislation has made the country's central bank and the securities commission responsible for overseeing the crypto market. As part of the designation, the Central Bank of Brazil will determine rules to be followed by virtual asset service providers, including the licensing requirements to operate in the country. - On the other hand, the Comissão de Valores Mobiliários (CVM), the country's securities commission, will have control over virtual assets qualified as securities.
- The legislation will come into force as of June 20.
- The country's certain laws on consumer protection and financial crimes will also continue to apply to virtual asset service providers.
Brazil is considered the crypto hub of South America as one of the largest markets in the region. - In December 2022, the former Brazilian president, Jair Bolsonaro, also approved a crypto regulation, marking the rollout of a virtual service provider license in the country and establishing a fraud crime involving crypto with a penalty of four to six years in prison alongside a fine in the event of a violation.
- In addition, the country's central bank recently published the final list of its central bank digital currency (CBDC), or the digital real, pilot project participants that included giant firms like payments services giant Visa and tech giant Microsoft.
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