Bitcoin and cryptocurrency regulation has been approved in the first round of considerations and is expected to be passed within the coming months. Originally there were two draft bills under review by the Chamber of Deputies. Senate bill 3825/19 would have defined the guidelines for regulation on Bitcoin and cryptocurrency exchanges while House bill 4401/21 would have adjusted prior legislation and added broader regulations for virtual assets.
Rapporteurs Senator Iraja Abreu and Deputy Aureo Ribeiro met in order to expedite the process for the bills. They eventually decided to place the Senate bill on hold while the House bill was pushed forward with additional provisions (borrowed from the Senate bill).
Abreu stated that “I'm doing everything in contact with the Chamber's rapporteur, who did a very good job. The Central Bank's technical team has also been very helpful. The texts are similar and converge into one.”
With an expedited bill, President of the Senate Rodrigo Pacheco explained that approval for the Bitcoin and cryptocurrency bill will be voted on in the next few weeks. He also said that the bill will meet the demand for safer business practices along with international agreements in order to prevent fraud within the country.
There is no mention whether Brazil will make Bitcoin legal tender but will instead give authority to the Brazilian president for deciding which government entity will oversee the regulatory framework around Bitcoin and cryptocurrency. The president has the option to create a new regulating body or may assign all oversight to the Central Bank of Brazil.
Additionally, tax incentives for Brazilian ASIC miners are mentioned in the bill in order to attract interest from local and international investors. However, Brazil does not currently have the most attractive energy rates when compared to their neighboring countries like Paraguay and Venezuela where electricity is much more affordable.
The bill also includes a penalty of four to eight years in prison if someone is found using virtual assets for fraudulent transactions. The bill may face more iterations as the process for Brazilian legislation continues.