In a hearing in Congress, Brazil’s central bank governor, Roberto Campos Neto, stated that policymakers are planning to strengthen regulations on cryptocurrencies and subject brokerages to their supervision. The central bank aims to scrutinize the backing of cryptocurrencies and associated activities due to the significant increase in cryptocurrency imports by Brazilians.
According to data released by the central bank, cryptocurrency imports surged by 44.2% from January to August this year compared to the same period in 2020, amounting to $7.4 billion. Campos Neto mentioned that there is a perception that local demand has shifted towards stablecoins, which are cryptocurrencies linked to real-world assets like the U.S. dollar. People in Brazil are increasingly using cryptocurrencies as a means of payment rather than solely for investment purposes.
The governor highlighted the concern regarding tax evasion and illicit activities associated with cryptocurrencies, stating, “We understand that a lot is connected to tax evasion or linked to illicit activities.” This indicates the central bank’s intent to address these issues and ensure compliance with regulations.
Additionally, Campos Neto mentioned the Brazilian central bank’s digital currency, DREX, which was originally set to launch by the end of 2022. It is expected to play a role in the world of crypto assets in Brazil, although further details about its implementation were not provided during the hearing.
This announcement signifies Brazil’s proactive approach to regulating the crypto industry and ensuring the integrity of the financial system. With the increasing popularity of cryptocurrencies in the country, the central bank aims to establish a framework that promotes transparency, security, and compliance within the sector.
Sources:
– Marcela Ayres, Reuters.
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