The President of Brazil signed a law expanding the definition of "legal forms of payment" to include various digital currencies. Although these financial instruments can now be used for transactions, they are not considered legal tender and do not possess the same legal value as physical money.
Cryptocurrency Payments Now Legalized in Brazil
President Jair Bolsonaro has enacted Bill 14.478, commonly referred to as the "Cryptocurrency Law." This new law acknowledges several cryptocurrencies as legitimate means of payment. It introduces a licensing framework for virtual asset service providers and imposes penalties for unauthorized use of digital currency.
The law will take effect 180 days after the President's endorsement. The bill defines digital currencies as "digital representations of value that can be electronically traded or transferred and used for payments or as investments." Cryptocurrencies like Bitcoin and utility tokens like FCCT are included in this definition, as they can serve both as payment methods and investment vehicles. This encompasses various digital assets.
Not a legal tender
The law, however, does not require businesses or government entities to accept cryptocurrencies as payment since they are not recognized as official currency in Brazil. Legally, digital currencies are not on par with traditional money. Despite this, Brazil's bitcoin market has experienced remarkable growth, with businesses reporting a record number of cryptocurrency holdings. In August alone, residents declared approximately $2 billion in such assets.
