RIO DE JANEIRO, BRAZIL – The president of the Central Bank, Roberto Campos Neto, said the institution is working on projects to regulate cryptocurrencies but that they will be regulated first as an investment and then as a means of payment.
In a presentation of the quarterly report on inflation on Thursday, September 30, Campos Neto said that there is greater demand for cryptocurrencies as an investment than as a means of payments.
“We are now discussing some projects on regulation. We understand that this world of cryptocurrencies has grown a lot in Brazil as an investment vehicle, impacting even the import numbers.”
The executive also explained the reason for prioritizing cryptocurrencies as an investment at this time. “Remembering that currency has a function as a means of payment, but when we look at cryptocurrency as a means of payment, it has grown little.
In another moment, he added: “The consequence of this for the Central Bank is that first we will regulate it as an investment and then, in another step, we will imagine how to regulate it as a means of payment. What we have on the table today is to regulate as an investment.
The BC’s economic policy director, Fabio Kanczuk, said that cryptocurrency transactions had impacted the country’s import statistics. Through August, he said, these transactions totaled US$4 billion.
In the report, the Central Bank revised the projections for the external sector. For current transactions, the expectation for 2021 went from a deficit of US$3 billion to US$21 billion, equivalent to 1.3% of the Brazilian GDP.
The reason for this increase is due to the growth of cryptocurrency operations and Repetro, the tax regime that suspends the collection of federal taxes on imports of equipment for the oil and gas sector: “These are items that are not computed in customs statistics, but that enter the balance of payments [of the Central Bank], such as Repetro operations and the purchase of cryptos”.
For 2022, the projection is for a deficit of US$14 billion in current transactions. The estimate for direct investments in the country was also revised and decreased from US$60 billion to US$55 billion in 2021 and US$60 billion in 2022.
In parallel to the regulation studied by the Central Bank, Brazilian parliamentarians have also been analyzing a bill dragging on since 2015 in Congress.
The committee that will regulate cryptocurrencies in Brazil has approved new changes to the text of the bill. The latest approved text quotes the bankers’ association Febraban and says that the executive branch will have the competence to regulate the crypto market. In addition, the typification of ‘fraud crimes’ and the registration requirement for cryptocurrency brokers are also new.