The Brazilian Senate will vote one bill this would make Brazil the latest Latin American country to regulate cryptocurrency. The legislation notes that it specifies guidelines for the provision of virtual asset services.
The Senate Economic Affairs Committee unanimously voted in favor of the cryptocurrency bill on February 22, 2022, potentially increasing the bill’s chances of passing a Senate floor vote. It will be forwarded to President Jair Bolsonaro to be sanctioned as soon as it is approved in the Senate and the House.
If the bill is passed, Brazil will become the largest country in Latin America to regulate cryptocurrencies, reducing the risk of money laundering and increasing investor protection. Some of the region's smaller countries are ahead of the curve, with Cuba enacting legislation that recognizes and organizes its use, and El Salvador has declared Bitcoin as legal tender alongside the US dollar.
What is Brazil's intention with this bill?
Well, the bill is more inclined to target criminal activities and keep tabs on illegal transactions.
The bill, which has been in the works for nearly three years, outlines various parts of what makes up a virtual asset (VA), a brokerage or exchange, and which federal agencies would have jurisdiction over the topic.
According to the Brazilian senator and rapporteur for the project, Irajá Abreu, the project will curb numerous financial crimes involving cryptocurrencies. He stated;
“The intention of the project is to deter or restrict illegal practices such as money laundering, tax evasion and many other crimes. There is a market that is licit, legal, which is the vast majority of this market, but there are exceptions.”
Virtual asset service providers must prevent money laundering and asset concealment while fighting criminal organizations, terrorist financing and proliferation of weapons of mass destruction, according to the bill. Violations of the text are punishable by imprisonment and penalties.
The Brazilian Chamber of Deputies approved a measure containing restrictions that allow the trading of virtual currencies in the country until the end of 2021. The Senate resumed the text and decided to vote on Abreu's proposal. One bill can be connected to another after it reaches the Senate floor.
Will the bill make cryptocurrency more popular?
According to Abreu, yes. He stated that:
“With regulation, cryptocurrency will become even more popular….Once this regulation is passed, the trend is that it will be increasingly adopted in the supermarket, in commerce, in a car dealership.”
According to Abreu, the law passed yesterday, more focused on investments than for common use, offers a good environment for the more widespread use of cryptocurrencies.
Brazil is the latest country to join a long list of others that have opened up to cryptocurrencies. While we may be in a crypto winter, there are many favorable signs for the mass adoption of cryptocurrencies.
