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February 26, 2022

Brazil Following in El Salvador’s Footsteps on Bitcoin Adoption

Brazil Senate Committee on Economic Activities has approved the crypto bill after nearly three years of deliberation. If passed, they would be the most populous Latin American country to do so.

The Brazilian Senate committee announced on their official website that they had unanimously approved the country’s crypto bill, bill PL 3825/19. It’s worth noting that the bill was originally drafted collaboratively by Senator Flavio Arns, the original author, the Central Bank, the nation’s Securities and Exchange Commission, and the tax authorities.

The committee’s approval of the bill marks the start of a process that could result in Brazil having clear regulations governing everyday transactions involving cryptocurrencies in the country.

If it is approved by both the Senate and the House, it will be sent to the President for his signature before becoming law.

The bill proposes tax breaks for Bitcoin miners as well as regulations to combat financial crime in the space. Miners who use renewable energy sources would be exempt from import tax under the bill, in an effort to encourage green mining of Bitcoin. In order to combat illicit activity in the nascent market, the bill also emphasizes anti-money laundering regulations.

Senator Iraja Abreu, the committee’s appointed spokesperson, stated:

“The intention of the project is to curb or restrict illegal practices, such as money laundering, tax evasion, and many other crimes. There is a market that is licit, legal, which is the vast majority of this market, but there are exceptions.

If the bill is passed, it is likely that there will be increased adoption of cryptocurrencies in the country, including institutional adoption, because they will be clear on the requirements to remain compliant.

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Latin American countries appear to be very interested in the cryptocurrency space. El Salvador is currently the most popular, having adopted Bitcoin as legal tender and launching a Bitcoin-backed bond.