Brazilian Government To Clarify Bitcoin Law With New Decree

The Brazilian government is about to issue a decree that changes some of the rules established in the Bitcoin Law approved in November 2022 by former President Jair Bolsonaro. The move is in line with the latest developments taken by President Lula da Silva in recent weeks.

Brazil Faces New Cryptocurrency Rules

After only a month in office, the new president confirmed his power by signing a series of decrees and measures aimed at changing what the previous government had established.

Now Lula’s team is working on new proposals to regulate the cryptocurrency sector and clarify existing laws on cryptocurrencies. In accordance with local reportsThe government has formed an extensive regulatory oversight team that includes Treasury Department executive secretary Gabriel Galipolo and economic reform secretary Marcos Pinto.

In addition, the regulation has the technical backing of the Central Bank (BC) and the Brazilian Securities and Exchange Commission (CVM). The decree was originally expected to be sent in early February to the office of the President of the Republic, known as the Casa Civil, but this has been delayed.

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In the meantime, the cryptocurrency industry is waiting for the decree, probably with more attention to the institution that will be the main regulator of the Bitcoin ecosystem. It was previously mentioned that the Central Bank will be the body in charge of regulating the cryptocurrency sector. However, Lula’s recent attacks on the financial institution raise some doubts.

Last month, Brazil’s president questioned whether central bank autonomy serves the national interest. Although he later appeared to relinquish it, he indicated that he would reconsider his decision-making independence from 2021.

What changes are envisaged for the Brazilian bitcoin law?

The focus of the new rules will be on the development of new rules relating to various aspects of the crypto industry. There are expectations that the new decree will bring clarity to the laws governing the crypto industry in Brazil.

The proposed law, which has been widely discussed, is the requirement for crypto exchanges and brokers to separate their assets. The measure has been discussed by lawmakers and suggests that crypto asset brokers separate their funds from customer deposits.

Proponents of regulation believe that this will prevent users’ cryptocurrencies from mixing with the work of exchanges and other service providers. The collapse of FTX is cited as a major factor that prevented users from withdrawing their funds due to malicious trading activity on the exchange.

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The proposal was initially approved when the bill was passed by the Senate, but was later annulled because it divided the legislators of the Chamber of Deputies. However, it is expected to be a vital component of the proposed Bitcoin fiat.

Brazil is considered one of the countries with widespread use of cryptocurrencies. Last November, he took a significant step by recognizing bitcoin as a means of payment and even an investment asset.

Bitcoin Price

At the time of writing, the leading cryptocurrency is trading at around $24,500.

Bitcoin is trading sideways.  Source: BTCUSDT Tradingview
Bitcoin is trading sideways. Source: BTCUSDT Tradingview

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