Brazil becomes part of a select group of countries that have established specific rules for operations linked to the digital asset market. This Tuesday, 20, The Legal Framework for Cryptocurrencies officially came into force on Brazilian soil.
The decree was signed last Wednesday, is 14, by the presidency of the republic The objective of the new law is to regularize the activities of crypto companies and brokers and, mainly, reduce the incidence of crimes involving currencies and other digital assets.
The changes brought by regularization
The cryptoactive market continues to expand in Brazil. That's why, The purpose of the legislation is to protect integrity and offer greater legal security for clients, brokers and other companies that are involved in any type of transaction or operation.
With the law, specific punishments against fraud were included in the Penal Code. Furthermore, improved rules have been defined for the operation of exchanges, currency trading houses. Now, to operate, all must have prior authorization from the Central Bank, institution currently regulating the cryptoactive market.
The Cryptocurrency Framework stipulates protection mechanisms to inhibit cases of money laundering, data sharing and financial pyramids. Another important point is that, with regulation, investors will have increased scrutiny in relation to companies in the segment.
In general, the new law provides that assets are a: “digital representation of value that can be traded or transferred electronically and used to make payments or for investment purposes”.
Until 8 years of imprisonment
The regularization and the new text also included in the Penal Code a new type of embezzlement that can be applied to the segment. In case of infringement, the criminal may suffer from 4 a 8 years of imprisonment and will still be liable to pay a fine.
As per the text: “organize, does, offering or distributing portfolios or intermediating operations involving virtual assets, securities or any financial assets with the aim of obtaining an illicit advantage at the expense of others, leading or keeping someone in error, through artifice, ruse or any other fraudulent means”.
Upcoming legal challenges
Infralegal regulation, although, It is a challenge that has not yet been completed for the sector. This step involves defining specific standards for operations and records of companies and brokers. The Central Bank was chosen as the regulatory institution after a decree from the Federal Government.
It will be up to her to improve this part included in the legislation. Another point that this same decree establishes is that the CVM will have the power to act when digital assets are considered securities.
Public consultation
Being praised and well accepted by market representatives and investors, the Cryptocurrency Legal Framework was sanctioned in December last year. Although, the lack of time for the sector to adapt to new requirements was 180 dias (six months).
With the end of this period, companies and brokers that do not comply with the requirements are already subject to fines and punishments by the Central Bank. In this way, cryptoactive companies should be more transparent about the activities carried out.
Experts point out that, probably, a new grace period can be given for companies to start regularizing. Yet, as in other cases of regularization, the Central Bank is expected to hold a public consultation with representatives and investors soon.
