Regulation
Brazil to tighten regulations on foreign crypto exchanges
Brazil’s tax authority, Receita Federal, is set to step up oversight of foreign cryptocurrency exchanges operating in the country to strengthen regulation and transparency amid rising asset usage digital technologies in Latin America’s largest economy.
According to recent reports, the 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 of the Federal Revenue Service, stress the need for this measure, responding that “it is a concern to first understand how they operate here, whether there is any illegality or not. “The government wants to guarantee compliance with taxation and that the services provided to customers in Brazil are fully legal.
Wagner Lima, risk management coordinator at Receita Federal, highlighted the need to review collaborations between foreign exchanges and local service providers to ensure compliance with a 2019 regulation requiring information sharing.
The decision comes as Brazilians declared 133.6 billion reais ($24.6 billion) in crypto assets from January to July 2023, a 36.6% increase from the previous year’s total . 14.5 billion reais were declared via foreign exchanges, representing a growth of 51.2% over the same period. base.
The next order, which is expected to be published, will ask exchanges to share how they operate and how they serve customers in Brazil. However, customer specific data and transactional information will be excluded in order to comply with current Brazilian laws.
Brazilian authorities are also focused on building a clear framework for digital currencies and their legal status, which is expected to be introduced by mid-2024. This framework aims to organize local and foreign exchanges operating in Brazil in order to ‘increase their compliance with local laws and legal requirements.
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