Taking effect in mid-2023, Brazil‘s Virtual Asset Legal Framework (Law 14,478/2022) represented a significant development for the country‘s cryptoasset industry. Brazil’s Securities and Exchange Commission (CVM) also issued a series of circular letters throughout the year, seeking to guide cryptoasset service providers on the expected classification of certain token offerings as securities.
New, innovative regulations also emerged, expressly permitting financial investment funds (e.g., equity, foreign exchange, multimarket and fixed income funds) to directly invest in cryptoassets, as previously only indirect investments in these assets were permitted. For the first time, cryptoassets came to be considered proper financial assets in Brazil.
In turn, the Brazilian Financial and Capital Markets Association (Anbima) announced specific rules and procedures for investing in cryptoassets, while Brazil’s Central Bank opened a public consultation on an appropriate regulatory framework for virtual asset service providers (VASPs). In light of these developments, a number of VASPs (mostly from foreign jurisdictions) began to seek information on how to better structure their operations for the Brazilian market.
“We have seen significant developments in the cryptoasset market since the law came into effect. Beyond the specific rules that have already been published, regulatory bodies have continued to hold consultations and hearings with the market and the public, gaining important viewpoints that should help to establish laws and regulations that meet the needs of the cryptocurrency industry”
