Prices for cryptocurrencies like Bitcoin are still far from recovering. At the time of publication, the market’s total value of all cryptocurrencies had changed by just 0.09% over the previous day and was $809.49 billion. Additionally, the value of Bitcoin did not change over the previous day; it was last spotted trading at $16.8k on Thursday. Amidst this downside, Brazil gives hope to crypto enthusiasts.
The official journal of the federal government reports that Brazilian President Jair Bolsonaro enacted a law on Thursday morning. The law establishes a thorough regulatory framework for the use and exchange of cryptocurrencies like Bitcoin (BTC). In addition, the law won’t take effect for 180 days.
The legislation, which had previously been approved by Congress, was passed by President Bolsonaro with no modifications. The new laws state that cryptocurrencies are a digital representation of value. In the South American nation, digital assets are accepted as a means of payment and as a form of investment.
According to the bill, a virtual asset is,
“a digital representation of value that can be negotiated or transferred electronically and used for payments or as an investment.”
No cryptocurrency, including Bitcoin (BTC), is recognised as legal cash by the new law. Which government organisations will be in charge of overseeing market regulation will be decided by the executive branch. When using cryptocurrency as a payment method, it is envisaged that the Central Bank of Brazil (BCB) will be in charge. The securities and exchange commission (CVM) will be in charge of regulating cryptocurrency investments. The BCB, the CVM, and the federal tax authority (RFB) all helped to draught the reform legislation.
More Assets To Join Bitcoin In Brazil?
If the BCB is recognised as the sector’s watchdog, the outlook is not good. The legal definition of a virtual asset cannot be changed by the regulator. There is no reason for the BCB to take extra steps to encourage the adoption of cryptocurrencies, nevertheless. Additionally, Roberto Campos Neto, the organization’s president, has voiced his disinterest in cryptocurrencies as a workable substitute for traditional currency. Volatility is one of the main causes of Neto’s lack of faith, according to him.
Regardless, a legal framework for the cryptocurrency market ought to encourage more open discussion regarding cryptocurrencies.