According to Nagel Paulino, head of the Central Bank’s regulatory department, the Central Bank of Brazil hopes to finalize cryptocurrency market regulations by 2025. The institution will conduct a second public consultation to finalize the drafts, hearing the opinions of market participants in order to tailor these rules to local needs.
Central Bank of Brazil Projects Finalizing Crypto Market Regulation By 2025
Brazil is getting closer to finalizing regulation regarding virtual asset service providers (VASPs) and their interaction with crypto. The institution aims to have a complete VASP regulation by early 2025, according to Nagel Paulino, head of the Central Bank’s regulatory department. The market participants will be given a period to comply with the finalized rules.
The delay in this task derives from a series of public consultations that the institution is already conducting. This is to know the views of market participants on subjects relevant to finalizing already existing drafts.
Public consultation in this regard was already conducted from December to February, using a public 38-item questionnaire that asked for input on several key aspects of the crypto industry, including asset segregation, risk management, and others.
The bank will issue a second public consultation this semester to help adapt the existing proposals to the Brazilian market. In this sense, Paulino stated:
The Central Bank already had a regulatory design, but the structure was very much based on international references. The local ecosystem of virtual asset service providers has its own particularities.
While this would conclude the institution’s task regarding VASP rules, several cryptocurrency-linked subjects still need to be fully addressed, including the tokenization of assets, tariff rules, liquidity providers, and most importantly stablecoins. This last item has a special relevance due to the popularity and volume these have reached in the Brazilian cryptocurrency market.
Federal Deputy Aureo Ribeiro, responsible for the current cryptocurrency asset law enacted in Brazil, stated that these consultations will also help create a “regulatory framework that will allow the market to grow and attract the attention of global investors.”