Brazil approves cryptocurrency bill recognizing Bitcoin as a payment method

member of parliament Brazil Approved a cryptocurrency framework bill for the use of digital currencies in Latin American countries.

Once the law is passed, Brazilians will be able to use Bitcoin as a payment method and digital assets will be recognized as an investment asset class.

Bitcoin as payment

House Bill 4401/21 aims to establish an institution to oversee the cryptocurrency industry in Brazil. This includes the operational management of service providers such as crypto exchanges.

Under the bill, exchanges will have to comply with certain rules to be granted access to the Brazilian market. For example, the process of separating user funds from exchange funds. The regulation also requires service providers to be approved at the federal government level.

Agencies delegate responsibilities to appropriate existing government agencies. According to Bitcoin Magazine, the Central Bank of Brazil will use Bitcoin for payments. The Comisso de Valores Mobilirios (Securities Regulator) handles investment regulatory aspects.

While this is a big step forward for cryptocurrency adoption, the bill falls short of making bitcoin legal tender.

Who will sign the bill?

The final hurdle before the bill becomes law is the president’s signature. The current president, Jair Bolsonaro, is set to step down on December 31 after being defeated by his political opponent Lula da Silva. narrowest margin October 31st.

The election results have been marred by controversy with Bolsonaro supporters who allege election fraud. commenting on his defeat, Bolsonaro He thanked those who voted for him and called on protesters to respect the law.

Earlier this year, before winning the election, Da Silva It acknowledged the expansion of cryptocurrency to local media in Brazil. He added that a framework needs to be put in place to harmonize domestic practices with international standards, especially regarding malicious activity.

“In addition to avoiding illicit trading practices, the government, in particular through its autonomous central bank, should comply with international standards to avoid illegal activities such as money laundering and currency evasion where cryptocurrencies can be used. A norm must be created.

Bitcoin is up 2.5% over the past 24 hours and is trading at $16,900 at the time of writing.