The President of Brazil, Jair Bolsonaro, is signing new legislation to regulate the use of crypto assets in his country.
According to a recent government memo, the Brazilian President is signing a bill into law that would regulate digital asset providers.
The bill defines what virtual assets are and what firms must do to obtain authorization to provide them. It also updates previous laws to include virtual assets in cases of fraud, money laundering, and crimes against the national financial system.
Among the requirements of the law are that all crypto exchanges and brokers must be based on free enterprise, free competition, transparency, sound risk-based approaches, consumer protection, and due diligence in preventing illicit activities, such as money laundering and terrorist financing.
The bill also further defines and establishes the penalties for committing crypto-related fraud.
“Organizing, managing, offering or distributing portfolios or intermediating operations involving virtual assets, securities or any financial assets in order to obtain an illicit advantage, to the detriment of others, inducing or keeping someone in error, through artifice, ruse or any other fraudulent means.
Penalty – imprisonment, from 4-8 years, and a fine.”
Though no specific digital assets were named in the legislation, the bill says it will be left up to the Federal Public Administration and other regulatory bodies to decide which virtual currencies will be regulated.
Last year, it was reported that Brazilians are participating in the crypto economy to the tune of $4 billion, a figure at the time estimated to be about three times larger than their investments in US stocks.
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