Regulation
Brazil will tighten regulation on foreign cryptocurrency exchanges
Brazil’s tax authority, Receita Federal, is set to increase scrutiny of foreign cryptocurrency exchanges operating in the country to strengthen regulation and transparency amid increased use of digital assets in America’s largest economy Latin.
According to recent reports, Receita Federal will soon issue an order requiring these international platforms, including Binance, Coinbase and others, to provide detailed operational data and information on their cooperation with local service providers.
Andrea Chaves, Assistant Secretary for Inspection at the Federal Revenue Service, stressed out the need for this provision, replying that “the concern is to first understand how they operate here, whether there is any illegality or not. The government wants to ensure tax compliance and that the services provided to customers in Brazil are completely legal.
Wagner Lima, risk management coordinator at Receita Federal, stressed the need to review collaboration between exchanges and local service providers to ensure compliance with a 2019 regulation requiring information sharing.
The move comes as Brazilians declared 133.6 billion reais ($24.6 billion) in cryptocurrencies from January to July 2023, marking a 36.6% increase over the previous year’s total of 14.5 billion of reais were declared using foreign exchanges, showing a growth of 51.2% on the same amount. basic.
The next order, which will be released, will ask exchanges to share how they operate and how they serve customers in Brazil. However, it will exclude specific customer data and transaction information to comply with current Brazilian laws.
Brazilian authorities are also focusing on building a clear framework for digital currencies and their legal status, which is expected to be introduced by mid-2024. This framework is intended to organize local and foreign exchanges operating in Brazil for increase their compliance with local laws and legal requirements.
Read also: Meta launches AI services for WhatsApp Business in India and Brazil