Scholars draw a problematic scenario for cryptocurrencies in Brazil

RIO DE JANEIRO, BRAZIL – Not a few law operators and economists have dedicated their days and nights to studying a subject that is as fascinating as it is challenging: cryptocurrencies. And, despite all this time of study, there are still more doubts than certainties about the subject.

To try to elucidate some of these concerns, a group of experts met on May 12 at the traditional Law School of the University of Coimbra, Portugal. For four hours, the scholars analyzed various aspects involving this novelty, which is not so new anymore, covering disciplines as disparate as Criminal Law, Tax Law, Economics, and Sociology.

The “1st Luso-Brazilian Seminar on Cryptocurrencies – A Socio-Legal and Economic View” ended with a worrying conclusion: Brazil urgently needs a definitive regulation of cryptocurrencies. However, the parliamentary initiatives on the subject are not only moving at a slow pace but are unlikely to fill all the gaps on the subject.

Pedro Góis, sociologist and professor at the Portuguese college; Ciro Chagas, criminal lawyer and professor on the MBA in Digital Compliance at PUC Minas; Vanessa Rodrigues, tax lawyer; André Hespanhol, criminal lawyer; Helder Sebastião, professor of Economics at Coimbra; and Silvio Azevedo, commercial consultant for banks and insurance companies, presented their ideas in Coimbra.

According to Ciro Chagas, Brazil still needs to evolve to reach maturity in the debate about cryptocurrencies (or crypto actives, as experts prefer to say). “Brazil started debating the subject a few years ago, and still with the perception that it was something like airline miles,” he said. “It’s important to make the differences clear; crypto-activities present much deeper solutions than is thought in the country.”

The other criminalist at the table, André Hespanhol, warned that the lack of such regulation has generated abuses by punitive agents, well in the “Lava Jato fashion.”

“The absence of regulation in the country has led to severe distortions in the criminal field, resulting in a very fragile environment and extremely virulent action by punitive agencies. In this scenario, the lack of regulation generates a considerable criminal risk for people who use cryptocurrencies.

Tax Law expert Vanessa Rodrigues said that Portugal has faced problems in her area of expertise. “We are, in Europe, one of the few countries without legal regulation from a tax point of view. Regulation is important because it gives investors legal security, including foreign ones,” she commented. “But many investors come to Portugal thinking there is no taxation of crypto actives, but Portugal is not a cryptocurrency tax haven.”

OLD SHARKS

In Pedro Góis’ opinion, the new world of cryptocurrencies is not exactly new, as there are more similarities between it and the “old world” than one might think.

“When we do a more sociological analysis, we see that cryptocurrencies have already been dominated by the traditional power owners, who are now coming back in the format of cryptocurrency owners. Since digital currencies don’t have a national and physical base, they are global; you have to find a language to control them,” the sociologist said. “Cryptocurrencies cannot be considered currencies, or at least not yet,” added Helder Sebastião.

In closing the debate, Consultant Silvio Azevedo gave a rather scary warning to small investors who want to bet on cryptocurrencies: the big sharks are coming to take this sea by storm. “The big banks can’t operate in this area because there are no regulations yet, but I believe they are ready to take over this market from the small ones; they just can’t do it yet.”

With information from Conjur