Bitcoin, legal tender in Brazil? Cryptocurrency adoption is gaining momentum

Christmas Crypto Gift – Brazilian President Jair Bolsonaro has signed a bill, which will certainly increase the attractiveness of the country for crypto companies. Cryptocurrencies therefore end the year, with a legislative victory in the land of samba.

Cryptocurrencies as legal means of payment in Brazil

According to one publication of last December 22 in the official gazette of the Federal Government of Brazil, Jair Bolsonaro signed Bill 14.478, which legalizes the use of cryptocurrencies as means of payment.

After approving it, the Chamber of Deputies of Brazil sent this bill to the office of Jair Bolsonaro, on November 20. The current president, who is due to leave office on December 31 this year, has therefore decided to put his signature to it, a few days before the Christmas holidays.

This law does not give legal tender to cryptocurrencies in Brazil, as is currently the case for the Bitcoin (BTC) in El Salvador. However, it recognizes cryptocurrencies as legal means of payment, and establishes a license scheme for virtual asset service providers.

Cryptocurrencies can be used legally as means of payment in Brazil
Cryptocurrencies can be used legally as means of payment in Brazil

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New Penalties Against Crypto Fraud

In addition, this new law defines the sanctions relating to fraud involving the use of digital assets. It also contains provisions that appear to be a reaction to the collapse of FTX. Indeed, the law requires crypto exchanges to distinguish customer assets from those of businesses.

With the adoption of this law, the regulation of cryptocurrencies is thus clarified in Brazil, although vagueness remains on certain points. For example, current legislation does not explicitly specify the agency responsible for overseeing cryptocurrency payments.

Regarding the agenda for the implementation of this law on cryptocurrencies, the latter will come into force in 180 days, i.e. in June 2023under the presidency of Luiz Inácio Lula da Silva.

Compared to some developed countries, jurisdictions in Latin America are therefore getting ahead of the legalization of cryptocurrencies. In the United States, some politicians are still working in favor of banning cryptocurrencies.

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