It’s a historic day for cryptocurrencies in Brazil, as the country’s first bill aimed at regulating the crypto sector has finally been adopted by the Senate.
In a plenary session, Brazil’s Senate passed the country’s first cryptocurrency bill, paving the way for the construction of a regulatory framework for the country’s crypto business.
To become legislation in the country, the bill must be approved by the Chamber of Deputies and then signed by President Jair Bolsonaro. This is predicted to happen before the end of 2022.
Senate President Rodrigo Pacheco presided over the session that authorized the project, saying:
“I want to congratulate the rapporteur of the project, Senator Irajá, for the approval, here in the Plenary of the Senate, for this important bill.”
Aureo Ribeiro, a federal deputy, first submitted the law in 2015.
Following extensive consideration on Tuesday, the bill was approved in the Senate, combining Senator Ribeiro’s bill with Senator Arns’ bill PL 3825/2019, for which Senator Irajá Abreu served as rapporteur.
During the debate, the Senate confirmed that the country’s executive branch would be in charge of developing crypto-asset legislation, with the option of creating a new regulator or delegating authority to the Securities and Exchange Commission (CVM) or the Central Bank of Brazil (BC).
Several senators, including the bill’s author, Senator Arns, focused on appropriate sanctions for crypto crimes, particularly fraud, during the session.
Senator Arns believes that the penalty for this type of crime should be graded based on the amount of fraud, money laundering, and other white-collar crime committed. He stated:
“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.”
Senator Arns’ motion was supported by Senator Rose de Freitas, who asked for harsher penalties for cryptocurrency-related offenses and stated that the Brazilian market had already moved more than $40 billion.
Senators also considered enticing cryptocurrency miners to set up shop in Brazil, as the import of ASIC mining gear into the country will be tax-free.
According to Bernardo Schucman, senior vice president of the digital currencies division of the American mining company CleanSpark, the cryptocurrency market requires specific regulation so that institutional investors who are risk averse feel encouraged and protected by investing in crypto mining in South America’s largest country. He stated:
“Regulation is very welcome [and] the trend is for Brazil to follow the largest economies in the world and facilitate the mining of these coins on Brazilian soil.”
The bill does not appear to encounter many obstacles in the Chamber of Deputies, where it must be passed in a plenary session before being delivered to President Bolsinaro.