Crypto license in Brazil

Brazil is an excellent choice for ambitious entrepreneurs looking to conquer new markets. Recently, the country has been experiencing economic growth and actively legislating to attract more and more investors from around the world.

At the end of 2022, the Brazilian Congress passed a law regulating digital assets in the country. This new regulation came into effect on June 20, 2023. It primarily affects companies operating in the cryptocurrency assets segment, such as exchanges.

What is VASP

A Virtual Asset Service Provider (VASP) is defined as a legal entity that performs at least one of the following virtual asset services on behalf of third parties:

• Exchange between virtual assets and Brazilian or foreign currency;
• Exchange between one or more virtual assets;
• Transfer of virtual assets;
• Management or administration of virtual assets or instruments allowing control over virtual assets;
• Financial services and services related to the offering of virtual assets by an issuer or the transfer of virtual assets.

Requirements for obtaining a cryptocurrency license in Brazil

The new requirements generally entail compliance with all internationally accepted principles of crypto broker regulation. Brazil highlights the following essential requirements:

• Cryptocurrency brokers must obtain a license to operate in Brazil, similar to financial institutions.
• Companies must also obtain a legal entity registration number in CNPJ (Cadastro Nacional da Pessoa Jurídica).
• It is necessary to report suspicious transactions to the authorities, such as the Financial Activities Control Council (COAF) and the Brazilian Securities and Exchange Commission (CVM).
• The authorized regulatory body will approve the operation of companies and conduct corporate reorganizations, monitor their activities, apply sanctions and fines, and cancel the permission to operate at its discretion or upon request.
• Fraud and other crimes will now have clear penalties under the legislation.

How to comply with the new requirements

Since the Central Bank of Brazil (BCB) is the regulator of crypto brokers in Brazil, it is expected to clarify the new licensing process soon and outline specific requirements for companies. From the law’s effective date, BCB must provide at least 6 months for existing service providers to comply with the new requirements.

Terms of obtaining a cryptocurrency license in Brazil

Obtaining a license is expected to take about a year and will require initial capital investments of approximately 2,000,000 BRL ($402,779).

Having a local company as a key licensing requirement

Since a key requirement for obtaining a crypto broker license is the presence of a legal entity, registering a local company will be necessary to start the licensing process.

Brazilian legislation imposes an important requirement for company registration – the presence of at least 2 founders, regardless of whether they are Brazilians or foreigners.

Company registration procedure in Brazil:

• Reserve a unique company name;
• Assign an identification number to shareholders in the Individual Taxpayer Registry (CPF);
• Register the company in Brazil at the Commercial Registry;
• Submit documents to the Federal Revenue Service and obtain the company’s identification number (NIRE) and the digital certificate e-CNPJ;
• Open a corporate bank account;
• Provide information to the Central Bank of Brazil (BACEN).

If you need a cryptocurrency license in Brazil, contact the lawyers of SBSB Fintech Lawyers. We specialize in supporting FinTech and Crypto projects since 2013, offering individual solutions for each client considering the company’s business model. We will help you choose the most suitable type of license and prepare the necessary documents for the legalization of your crypto business and obtaining a cryptocurrency license in Brazil in accordance with the legislation, providing full legal support.