Brazil passes law regulating the use of bitcoin in payments
Brazil’s president has signed a comprehensive regulatory framework for cryptocurrency that regulates the use of bitcoins as payment. Brazilian President Jair Bolsonaro has signed into law a law that establishes a complete regulatory framework for the trading and use of bitcoins in the country.
Bolsonaro passed the bill approved by Congress without any changes. The new rules recognize bitcoin as a digital value that can be used as a means of payment and an investment asset in the country.
The new law, which takes effect 180 days after it is signed today, does not make bitcoin or any other cryptocurrency legal tender in the country. However, the legitimacy given to the option of using BTC as payment could encourage more cryptocurrency activity in the country. However, this will ultimately depend on the actions of the responsible regulatory body.
The Central Bank of Brazil (BCB) is expected to regulate the use of Bitcoin as a payment. At the same time, the country’s Securities and Exchange Commission (CVM) will control when it is used as an investment asset. Both the BCB and the CVM, together with the Federal Tax Authority (RFB), helped lawmakers draft the Digital Assets Act.
Along with this, BCB is working on the release of its own digital currency, Real Digital (CBDC), which is planned to be launched by 2024. In addition, next year the regulator will launch a closed CBDC testing with a group of financial institutions. The Central Bank will develop a digital state currency in such a way that it does not violate monetary policy or harm the balance sheets of banks.
The development of national digital currencies in various countries of the world has been going on for several years. The initiatives in this area come after the G20 – an intergovernmental forum comprising the world’s 20 richest economies – announced in 2020 that improving cross-border payments was a top priority for its member countries.