Brazil is set to become the latest country in Latin America to legally recognize digital currencies, with a new pro-Bitcoin bill heading to the Senate for its approval. The bill has been in the works for three years now and will regulate the day-to-day uses of digital assets.
First introduced in 2019, the bill was unanimously approved by the Senate’s Economic Affairs Committee (CAE) this week. It was then sent to the Senate plenary, and if it sails through, it will be sent to the Chamber of Deputies. After this, President Jair Bolsonaro will then sign it into law, making Brazil the latest and biggest country in Latin America to recognize Bitcoin. However, the president can also veto the bill and send it back to parliament.
If signed into law, it will officially recognize virtual currencies as “digital representations of value that can be traded or transferred by electronic means and used to make payments or for investment purposes.”
This will allow Brazilians to make payments in Bitcoin, a privilege that many countries, including most recently India, have refused to grant the digital currency. India has been moving towards legalizing Bitcoin as an asset, claiming that allowing its use as a currency could destabilize the local economy.
Brazil will also recognize virtual asset service providers (VASPs), with the government issuing licenses to all Bitcoin firms. Once registered, they will have to abide by a strict code of conduct that includes being required to notify the Brazilian Financial Activities Control Council in case of a transaction suspected of money laundering.
The bill will also take away jurisdiction over the market from the Securities and Exchange Commission (SEC), which has played a leading role in policing the sector. It recommends that the tax agency known as Receita Federal and the central bank be jointly in charge of the industry.
“With regulation, cryptocurrency will become even more popular. Once this regulation is approved, the trend is that it will be increasingly adopted in the supermarket, in commerce, in a car dealership,” Senator Iraja Abreu commented.
