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The law created a licensing system for suppliers of virtual asset services and included various digital currencies in the list of accepted payment methods in Brazil.
The new law
A measure to legalize the use of cryptocurrencies as a form of payment in Brazil was approved by Jair Bolsonaro, who will step down as president of that nation on December 31. Bolsonaro's office (1) said that in El Salvador, Brazilian citizens wouldn't be allowed to utilize cryptocurrencies like Bitcoin as legal cash. However, the recently approved law defines several digital currencies as acceptable payment methods in Brazil. It also provides a licensing system for companies that provide services related to virtual assets and imposes fines for fraud involving digital assets.
The lack of Governing Bodies
The declaration from Bolsonaro made no mention (2) of which government agency may oversee cryptocurrency payments. However, as in the US, Brazil's Securities and Exchange Commission oversees digital assets classified as securities. As a result of the failure of FTX, the law also includes rules mandating exchanges to discriminate between the user and corporate assets.
The cryptography law is currently underway. President signed bill 14.478 into law following endorsement from the nation's Chamber of Deputies in a publication of the federal government of Brazil's official journal on December 22. On November 29, the parliamentary body completed recognizing crypto payments by sending the law to the president's desk. By the bill's language, 180 days, or most likely in June 2023, for effect. Soon after Bolsonaro leaves office, Luiz Inácio Lula da Silva, also known as "Lula," will take over as president on January 1. From 2003 to 2010, Lula presided over Brazil as president. In the past, he has advocated for using blockchain technology and cryptocurrencies.