On Tuesday, February 22, 2022, Brazil initiated a framework to legalize cryptocurrency in the local market. The initiative could be a milestone for the growth and development of digital cryptocurrencies in Brazil.
The Brazilian Senate’s Economic Affairs Committee collectively passed a bill regarding crypto regulation, establishing a path of voting at Senate and after that send to the lower house for further consideration. When National Congress approves the bill, it will finally be sent to President Jair Bolsonaro for approval to make it part of the law.
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Suppose the proposed bill is approved and becomes part of the law. In that case, Brazil will be the first largest Latic American country where clear rules and regulations will be applicable for digital cryptocurrencies investments.
At the same time, El Salvador has already set its position as the first country in the world to acknowledge Bitcoin in September 2021 legally. In addition, El Salvador also promoted Bitcoin through various promotion schemes like awarding $30 to each citizen for downloading its national digital wallet.
Finally, Cuba followed the trend and regulated cryptocurrencies like Bitcoin last year, stating “reasons of socio-economic interest.”
The Important Minutes of Bill
The bill provides the essential details about cryptocurrencies and their operations. The bill also prescribes the duties and responsibilities of crypto market service providers. Then, it will propose names of various departments to the federal government for finalizing one to set and control legal framework and legalize cryptocurrencies. Most probably Central Bank of Brazil (BCB) is expected to govern the crypto market, according to Senator Iraja Abreu.
Abreu informed Bloomberg that he had already offered a bill in 2019 that the cryptocurrency market could grow in the country if the bill is successfully approved.
Once this regulation is approved, the trend is that it will be increasingly adopted in the supermarket, in commerce, in a car dealerships.
Brazil Aim To Control Crypto Crimes
Abreu briefed that the legalization of the cryptocurrency market can help control the crimes. The principal purpose of this proposal is to limit illegal activities, particularly tax elusion, money laundering, and other offensives linked with the crypto market.
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According to the bill proposal, digital currency traders must completely understand anti-money laundering systems and limit illegal transactions. Furthermore, a person who does not abide by crypto laws must be imprisoned or heavily fined. Regulatory authorities had already seized R$172 million ($33 million) from crypto exchanges involved in money laundering in Brazil.
Apart from legalizing the cryptocurrency market, Brazil plans to establish its own local central bank digital currency (CBDC), like many other countries wish to do so. Brazil Central Bank (BCB) intends to test the programs this year before finally launching the digital asset in 2024.