The law for the regulation of the cryptocurrency market was sanctioned by President Jair Bolsonaro. The project establishes important aspects of the segment, such as the definition of virtual assets, providers and the crime of fraud with the use of crypto assets and their penalties.

The text of PL 14,478, of 2022, was published in this Thursday’s edition (22) of the Official Gazette (DOU) and will come into effect in 180 days.

According to the new law, virtual asset service providers can only operate in Brazil with prior authorization from a federal public administration entity. The conditions and term will be established by the responsible body, as well as compliance with the rules to keep the market active.

The law adds to the Penal Code – Decree-Law 2,848 of 1940 – a new type of embezzlement, with a penalty of imprisonment from four to eight years and a fine. Cases of ‘scam’ or projects that seek to gain illicit advantage at the expense of others through cryptocurrencies will be considered crimes.

In addition, the Money Laundering Law – Law 9,613 of 1998 – will include crimes committed through the use of virtual assets, with a prison sentence of three to ten years, when committed repeatedly. The text also determines that companies must keep all transaction records for the purpose of passing on information to inspection bodies and combating organized crime and money laundering.

The virtual asset and cryptocurrency markets

The virtual asset is defined by law as the digital representation of a value that can be traded or transferred by electronic means, as well as used for payments or investments. Those that do not fit this definition are:

  • traditional currencies (domestic or foreign);
  • resources in reais held electronically;
  • loyalty program points and rewards;
  • mobile values;
  • financial assets under existing regulation.

One of the changes made by the Senate was the permission for public administration bodies and entities to maintain accounts and carry out operations with virtual assets and derivatives. The norm originates from PL 4.401/2021 approved in November by the Chamber of Deputies, and in April of this year by the Senate. Federal deputy Áureo Ribeiro (Solidariedade-RJ) is the author of the PL.

In addition, the proposal incorporated excerpts from PL 4.207/2020, by Senator Soraya Thronicke (União-MS). In the Senate, this proposal had Senator Irajá (PSD-TO) as rapporteur.