Central Bank of Brazil to regulate digital currencies

The Central Bank of Brazil has been pushing for friendlier regulations for the sector and in a recent event, its president revealed that the bank is seeking to establish regulatory clarity for digital currencies. Brazil has reportedly been the leader in digital currency adoption in Latin America. This has been despite the lack of a regulatory framework to police the industry, something that it currently is determined to change.

The bank has been in ongoing talks with the local securities regulator to adapt a new framework that allows digital currencies to exist alongside platforms like PIX, making them easier to access for the average Brazilian. PIX is a digital payments initiative backed by the Brazil-based government that has become wildly popular in the country. It now boasts of having 96 million users, close to half the population of the South America-based country. In August 2021, PIX hit a record 40 million transactions in a day, CoinGeek reports.

Apparently, regulators are however concerned about the use of digital currencies as speculative assets rather than transactional currencies, Bloomberg reports. The central bank’s move comes as the Brazil-based police launched Operation Compliance, a probe against digital currency money laundering. About 150 federal police officers are involved in the operation and already, they have executed dozens of seizure warrants across the country.

Regulatory clarity has continued to claim its victims in Brazil, with exchanges that offered unlicenced products being forced to take them down. One of these is perennial law flouter Binance. As Brazilian outlet Portal do Bitcoin reported, Binance has suspended the trading of futures contracts on its Brazilian platform to comply with regulations.