Brazil’s President Bolsonaro Signs Crypto Regulations Into Law

• The new law establishes a crime of fraud involving virtual assets, with a penalty. 
•  It also creates a “virtual service provider” license .

Brazil’s President Jair Bolsonaro approved a crypto regulatory bill recently passed by the country’s Chamber of Deputies and Senate on Thursday. The bill will not permit the use cryptocurrencies like Bitcoin. Recently signed legislation includes numerous digital currencies as authorized payment methods.

The new law establishes a crime of fraud involving virtual assets, with a penalty of between four and six years in jail plus a fine. It also creates a “virtual service provider” license. And opens the way for the establishment of a new federal body to oversee companies that deal in digital assets. 

The New Law Will Take Effect in 180 Days

Bolsonaro’s announcement does not mention which federal agency might be in charge of overseeing cryptocurrency payments. As a result of the failure of FTX, the law also includes rules mandating exchanges to discriminate between the user and corporate assets. After the approval on Thursday, businesses will have 180 days to adapt to the new regulations.

Last Monday, the Securities Administrators of Canada issued regulations prohibiting the sale of cryptocurrencies on margin to Canadian clients. Any platform in the nation will come under regulation by securities legislation. Also included the crypto trading platforms that are yet to register. 

Unregistered platforms will soon be assigned a deadline by which they must submit to their major regulator a Pre-Registration Undertaking (PRU). In PRU, they have to affirm their intent to adhere to the standards required of organizations that have already obtained registration. If they don’t, they can be subject to punishment. Several cryptocurrency companies, including Celsius, Voyager, and BlockFi, have filed for bankruptcy this year.