Brazil Is Set to Introduce First Law on Bitcoin, Other Cryptos

Brazil has finally taken a huge leap into the Bitcoin sector. Senator Irajá Abreu announced that Brazil’s bill has been approved to regulate the cryptocurrency market in the country.

Brazil becomes the first South American country to launch a cryptocurrency law. In a survey done by Gemini, Brazil’s digital asset user numbers surge to 41%, compared to America’s 20%.

The senator stated in an interview for Senate TV:

The cryptocurrency market moved BRL 215 billion in 2021. It’s a giant market that seeks legal securities for its investors.

Since 2015, the bill has been debated in the Chamber of Deputies. After passing several rounds, including the Senate’s Economics Committee, Senator Irajá said that the National Congress will pass the bill by the end of 2022. Both Chamber of Deputies and President Jair Bolsonaro need to sign the bill.

The passed law will empower the Brazilian president to establish a federal entity to carry out all of the country’s legal cryptocurrency laws.

If no new regulator gets appointed, the region’s Securities and Exchange Commission or the Central Bank of Brazil will most likely assume responsibilities. Furthermore, crypto miners would not have to pay any tax on the importation of the Australian Securities & Investments Commission (ASIC) mining equipment.

The law would ensure that the government has sufficient authority to regulate cryptocurrency in order to prevent it from being used for illegal activities or money laundering.

Those who misuse cryptocurrency will face serious consequences, including a prison sentence of at least four to eight years. The bill also states that specific exemptions and incentives will be granted to entice miners to relocate to the country.

Furthermore, Brazil’s Central Bank President, Roberto Campos Neto, announced the establishment of a pilot program to develop and execute a sovereign digital currency in the country.

He added that the new Central Bank Digital Currency, or CBDC, will be operational by the end of this year and will have a fixed supply with only a specific quantity created, similar to how Bitcoin operates.

The CBDC pilot project is the culmination of multiple collaborations between the Brazilian Central Bank and nine other partnering banks and will add Brazil to the expanding list of governments favoring cryptocurrency adoption.