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- Brazil has stopped the fast pace at which it was adopting Bitcoin as a legal tender or legal digital asset
- New regulations shall be stricter and will be more controlling of cryptocurrency and blockchain technology
- Cryptocurrency exchange in Brazil face a hurdle as the CVM resources
With many countries hopping on the cryptocurrency wagon, some are halting the progressive approach because of risky concerns that arise with cryptocurrency. European and American countries have been looking to adopt cryptocurrency after the El Salvador Bitcoin adoption in the month of June. However, Brazil has stopped and paused on the acceleration of cryptocurrency in the country even after fighting hard for legalizing the trading of the digital asset in the economy. The CVM, which is a counterpart of the United States’ SEC in Brazil, has declared rather opinionated views about cryptocurrency and its regulation.
Brazil on the path to recourse crypto’s direction in the country
The new nominee for CVM mentions that Brazil needs to control the operations of cry[ptocurrency in the country and hence, the nation has put brakes on the race to boost cryptocurrency. Otto Eduardo Albuquerque Lobo, the recent nominee for CVM, has stated that the alarm at which the downside of cryptocurrency is elevating itself and causing security concerns shall lead to strict regulations for cryptocurrency and digital assets. Even after the increasing interest of participants in the country, the asset class of digital assets are yet to be classified by the Brazilian Law.
President Jair Bolsonaro asked Otto Eduardo Albuquerque Lobo to lead the CVM, and the operational processes are on the verge for authorization even in the midst of a political crisis. The Economic Affairs Committee of the Federal Senate has already questioned him and approved his nomination on July 5, 2021. In a speech given to the Country’s senate, Eduardo explained his distrust in the handling of cryptocurrency by the CVM recently in the market. Strict regulation must be imposed according to the new leader of the CVM. Nevertheless, this year the CVM authorized the negotiation of ETFs, index funds, of crypto-assets in Brazil.
Conflicting opinions leaves the country in a challenging phase
The present President of CVM, Marcel Barbosa, has an opposite stance in relation to this, and he believes that regulators should not impede innovation. According to Barbossa, new technologies push the frontiers of regulation and our role is to learn with what is new and make sure that this innovation impacts the market without harming the situation of market participants.
While Barbossa was at his tenure for the role of the President, Brazil implemented a regulatory sandbox that included several projects that sought to apply new technologies, including blockchain and cryptocurrencies, to the field of public administration.
Presently, Brazil has two legal and licensed crypto ETFs. Likely, many fintechs work as cryptocurrency exchanges and permit their clients to make use of prepaid credit cards as long as people exchange their Bitcoin to fiat before purchases.
Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.
