The Brazilian government has designated the Central Bank as the regulatory body for the cryptoasset market, encompassing cryptocurrencies like Bitcoin, platforms such as Ethereum, and non-fungible tokens (NFTs).
The announcement was confirmed in a decree published in the recent edition of the Official Gazette.
The decree, bearing the signatures of Brazilian President Luiz Inácio Lula da Silva, Finance Minister Fernando Haddad, and Central Bank President Roberto Campos Neto, stipulates that the monetary authority has a six-month timeframe to establish regulations for the burgeoning sector.
This industry has seen significant growth among the populace due to the proliferation of digital platforms, particularly in the aftermath of the COVID-19 pandemic.
The announcement of the decree has been eagerly anticipated by businesses in the crypto sector, who view it as a means of providing greater legal certainty to the market.
The Brazilian Association of Cryptoeconomics (ABCripto) lauded the document’s publication, stating that it marks a “fundamental” step in safeguarding investors and the digital asset ecosystem.
The new decree endows the Central Bank of Brazil with the power to authorize firms to offer virtual asset services and to formulate rules governing service providers.
It will also determine activities in this field within the foreign exchange market or those that need to be regulated by foreign capital in the country or abroad.
Additionally, the decree reinforces the role of the Securities Commission, which will maintain oversight of the assets representing the sector’s securities.
The legal framework for crypto-assets, approved by the Brazilian Congress last year, is set to come into effect on June 20.