As per local media, one major issue is that the bill in question doesn’t seem to consider tokens as digital securities or assets – and they therefore would not fall under Securities and Exchange Commission regulation. The updated position of the country’s SEC follows the appointment of a new board and the raised relevance of the cryptocurrency sector in the nation’s financial services.

Lawmakers in Brazil have been working on norms for cryptos since 2015, but the Senate only approved the final version of a bill in April 2022. Once the Congress of Brazil completes its final revisions, the bill will be sent to the nation’s president, who will sign it into law.

As mentioned in the approved text, a digital asset is a virtual representation of value that can be transferred or traded electronically, and used for investment or payment purposes. Additionally, it defines the best practices for Know Your Customer (KYC) processes and establishes methods to prevent money laundering. According to the bill, Non-Fungible Tokens (NFTs) are also not regarded as securities, while most other tokens are in the mid of discussions about whether they are.