The Central Bank of Brazil has banned the use of crypto assets for settlement in regulated cross-border payment channels.

The Central Bank of Brazil (BCB) issued Resolution No. 561, prohibiting the use of virtual assets for settlement in regulated eFX international payment and transfer services. The resolution stipulates that payments and receipts between eFX service providers and their overseas counterparties must be conducted solely through foreign exchange transactions or non-resident Brazilian Real accounts, strictly prohibiting the use of virtual assets. This regulation also applies to eFX providers in the transition period that have not yet been included in the approved category; these companies wishing to continue providing services must apply for authorization from the central bank by May 31, 2027. This move is not a complete ban on crypto asset transfers within Brazil, but rather aims to confine cross-border payment flows within a regulated foreign exchange track. The Central Bank of Brazil stated that this move is due to concerns about money laundering, taxation, and monetary sovereignty arising from the surge in the use of stablecoins in cross-border payments. (Cointelegraph)