In a recent move, the Federal Revenue of Brazil has announced stricter monitoring of foreign cryptocurrency exchanges operating within the country. The purpose of this initiative is to ensure that these platforms comply with the regulations established in 2019. Exchanges will be required to provide specific information about their interactions with local service providers to ensure compliance with the law.
Andrea Chaves, the Undersecretary of Inspection at the Federal Revenue, highlighted the agency’s concern, stating, “It is important for us to understand the operations of foreign cryptocurrency exchanges in Brazil and determine if there are any illegal activities taking place.”
Furthermore, the IRS is planning to gather detailed information on cryptocurrency assets held by Brazilian residents that are subject to taxation. A decree mandating the cooperation of exchanges is expected to be issued by the end of the week to streamline the process.
It is worth noting that currently only domestic companies are obligated to report their transactions directly to the IRS, distinguishing their responsibilities from those of foreign platforms.
Prominent international cryptocurrency exchanges in the Brazilian market include Binance, Coinbase, OKX, and KuCoin, among others.
The cryptocurrency landscape in Brazil has witnessed significant growth, as reported by the IRS. In the first half of 2023, the total amount declared in cryptocurrencies by individuals and businesses amounted to 133.6 billion reais (approximately US$24.6 billion), with 14.5 billion reais (approximately US$2.7 billion) attributed to foreign exchanges. These figures represent a 36.6% and 51.2% increase, respectively, compared to the same period in the previous year.
Please note that the opinions expressed in this article are for informational purposes only and should not be considered financial or investment advice. Investing in cryptocurrencies carries inherent risks of financial loss.