Brazil Central Bank Unveils Comprehensive Crypto Regulatory Framework

The Central Bank of Brazil has officially released a regulatory framework for cryptocurrency service providers, setting strict new standards for licensing, capital requirements, and foreign exchange compliance.According to Wu Shuo, the new framework requires all crypto companies operating in Brazil to obtain licenses and comply with foreign exchange and capital market regulations. International transactions must also be reported regularly to the central bank.Key Requirements for Crypto CompaniesUnder the framework, crypto service providers must maintain a minimum capital of 10.8 million reais (approximately $1.9 million USD), while larger or systemically important firms will be required to hold at least 37.2 million reais.Companies that fail to meet these financial and operational requirements will be prohibited from operating in the country.In addition, foreign crypto platforms must establish a local entity in Brazil to continue offering services to Brazilian users.Stablecoins and Self-Custody RulesThe new rules extend to stablecoins and cross-border crypto transfers, bringing them under foreign exchange regulation.To enhance oversight, the central bank has imposed a $100,000 transaction cap for operations using self-custodied wallets and requires monthly transaction data reporting beginning in May 2025.Implementation TimelineThe regulations will take effect on February 2, 2025, and existing crypto firms will be granted a nine-month compliance period to meet the new requirements.The Central Bank stated that the framework aims to strengthen consumer protection, prevent financial crimes, and integrate digital assets into Brazil’s broader financial system in a “safe and transparent” manner.