Brazil's central bank announced on Monday that it has decided to divide the process of regulating crypto-assets and virtual asset service providers into phases, with regulatory proposals expected by the end of this year.

The decision effectively delays the completion of the process following a 2022 law on the subject, which paved the way for subsequent regulation by the central bank.

In a congressional hearing last year, the bank's director of regulation, Otavio Damaso, had projected regulation to be wrapped up by June 2024.

After launching a public consultation on the matter in December 2023, which concluded in January, the central bank said it would now open a new consultation in the second half of this year.

The central bank told Reuters that the first public consultation aimed to gather input from society, also addressing issues not covered by the 2022 law, such as the asset segregation of virtual asset service providers.

This required "reasonable dedication from the teams involved in the regulatory work," it said, adding that the diversity of activities conducted by entities in the virtual assets sector and the various structures of these entities necessitated this preliminary effort.

"The second public consultation, now focused on regulatory texts, aims to use the initial input to, once again with broad support from society, establish a robust regulatory framework," said the central bank.

Source : Yahoo Finance / May 21, 2024