In our newsletter about the Regulatory Framework for Cryptoactive Securities introduced by Law n# 14.478/2022, we reported that the designation of the competent public entity for regulating virtual assets was pending.

With the recent enactment of Decree n# 11.563 on June 13, 2023, the Brazilian Central Bank has been granted the authority to regulate, authorize, and supervise companies offering services related to virtual assets.

The measure marks a crucial development in implementing provisions outlined in the Regulatory Framework for Cryptoactive Securities. The Central Bank will establish comprehensive guidelines encompassing various aspects, including fostering an environment of free initiative and competition for service providers, and ensuring consumer protection and defense while considering international recommendations. Moreover, these regulations will apply to both existing companies operating in Brazil and new entrants.

This designation of competence will facilitate not only the regulation but also the integration of cryptoactives within the bank sector with other financial institutions, such as the instant payment system (PIX). Furthermore, the rule provides clear guidance in response to the existing doctrinal divergence about the legal nature of cryptoactives, thus establishing a more precise and consistent regulatory framework.

The Securities Commission (CVM) will retain its responsibilities and autonomy in supervising and regulating securities. In addition, it’s worth highlighting that the Decree does not apply to assets representing securities subject to the Stock Corporation Law.

For any inquiries or clarifications regarding this matter, the teams at Fraga, Bekierman & Cristiano Advogados are fully prepared to provide comprehensive assistance. sp;