Brazil’s Senate approves law to regulate cryptocurrencies

Brazil, the largest South American country, is joining the first movers to regulate cryptocurrencies. The Brazillian senate has passed a bill to regulate cryptocurrencies in the country on April 27. The bill yet must first be passed by the Chamber of Deputies before President Jair Bolsonaro signs it into law.

The bill aims at creating a regulatory framework for the country’s crypto industry. As per the system proposed by the senate in the bill, crypto legislation would be the responsibility of the executive branch of the government. Moreover, the executive branch would have the option of creating a new regulator for cryptocurrencies or delegating jurisdiction to the Securities and Exchange Commission (CVM) or the Brazilian Central Bank (BC).

Moreover, the proposed laws also aim to attract crypto businesses to the country. The lawmakers plan on exempting Bitcoin miners from all import charges on ASIC mining machines to entice them to set up shop in Brazil.

Brazil is also aiming at getting into the CBDC game, like many other countries across the world. It is noteworthy to mention that as per information from Brazil’s central bank the CBDC trial would begin in 2022.

The bill also delves into what the punishment would mean when it comes to crimes related to cryptocurrencies. Several senators, including the bill’s author, Senator Arns, focused the discussion on appropriate sanctions for crypto crimes, particularly fraud.

According to Senator Arns, the penalties for this type of crime should be scaled according to the amount of fraud, money laundering and other white-collar crimes committed.

“The penalties must be proportionate to the amount of value affected by this type of crime. So whoever committed a crime of US $1 billion causing damage to thousands of people would have a greater penalty than the someone who affected less value,” he said.

Interestingly, this is not the first time the cryptocurrency bill was debated on the Senate floor in Brazil. In 2015, federal deputy Aureo Ribeiro introduced the cryptocurrency regulation legislation for the first time.

The bill does not appear to face many challenges in the Chamber of Deputies, where it must be approved in a plenary session before being sent to President Bolsinaro before becoming law. By the end of 2022, this is expected to happen.