The Chamber of Deputies of Brazil approved the law, which legalizes cryptocurrency as a method of payment. However, before it can be implemented, the law still needs to be approved by the executive branch.
Although Brazil has not made Bitcoin BTC tickers down $16,852 legal tender like El Salvador did last year, the country in South America has passed a law that makes crypto payments legal everywhere in the country.
A set of rules has been approved by Brazil’s federal legislative body, the Chamber of Deputies, to make cryptocurrency use as a payment method legal in the country. Although this marks significant progress for crypto in Brazil, the law still needs the president’s signature to become law.
The fact that the bill was approved does not make any cryptocurrencies legal in the country. However, the definition of payment methods that are supervised by the country’s central bank will include digital currencies and air mileage programs in the bill.
The executive branch of the government must choose which office will be in charge of supervision once the law is passed. The Brazilian Securities and Exchange Commission (CVM) will still have jurisdiction over tokens that will be treated as securities.
The law allows for the licensing of crypto exchange platforms, as well as third-party custody and management of crypto, in addition to making crypto a payment method. To avoid a repeat of the FTX collapse, the law will also mandate that exchanges clearly distinguish between user funds and company funds.
A similar proposal was made in June to allow Brazilians to pay with cryptocurrency and safeguard their private keys from being taken by the courts. The goal of the proposal is to make crypto assets an “instrument of access” to goods, services, or investments as well as a means of exchange.
In the meantime, Thiago César, CEO of Transfero Group, a company that is closely associated with the crypto ecosystem in Brazil, claims that despite the fact that the collapse of FTX has had an impact on numerous sectors of the crypto industry, it will not affect Brazilians’ routine use of crypto.