Brazil Moves to Regulate Crypto Under Full Financial Supervision

Brazil’s central bank has finalized a sweeping set of rules that effectively brings crypto firms under full banking-style supervision - a major shift that folds the digital asset sector into the country’s regulated financial system.

The new framework, issued under Resolutions 519, 520, and 521, creates a licensing class for virtual asset service providers (SPSAVs) and extends traditional requirements for AML, transparency, and consumer protection to crypto platforms. The rules officially take effect in February 2026, with cross-border and capital reporting to follow in May.

A key change redefines stablecoin transactions as foreign-exchange (FX) operations, meaning payments or transfers using fiat-pegged tokens will now face the same oversight as currency trades or international remittances. Only authorized financial institutions and licensed SPSAVs will be permitted to handle these operations, and transactions with unregistered offshore partners will be limited to $100,000.

Transfers involving self-custody wallets will also fall under stricter identification rules, requiring service providers to verify the source and ownership of funds – a move aimed at closing long-standing gaps in anti–money laundering controls.

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Central bank officials said the reform seeks to increase legal certainty, improve financial transparency, and capture stablecoin flows within Brazil’s official economic statistics. President Gabriel Galipolo recently revealed that nearly 90% of local crypto activity involves stablecoins, mostly used for payments – a trend that has drawn attention to risks around tax evasion and illicit finance.

While the new structure may raise compliance costs, especially for smaller firms, regulators believe it will strengthen trust in the market. For Brazil – one of Latin America’s largest crypto hubs – the message is clear: digital assets are welcome, but they’ll now play by the same rules as traditional money.