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Internal Revenue Service rules cooled bitcoin market in Brazil, says exchange owner who closed

Cryptocurrency

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One of the cryptocurrency brokers that announced the end of activities this year, the gaúcha Access Bitcoin cites the current scenario of the Brazilian market as a reason for the closure – especially because of the rules defined by the IRS.

“After the rules of the Federal Revenue, we noticed a significant decrease in the volume traded within our market. We also feel that the market has cooled for smaller exchanges ”, explains Pedro Nunes, CPO of the exchange.

To clients who have investments in the exchange, Nunes recommends two exits:

“We will recommend that anyone who has funds in BTC (Bitcoin) transfer to other exchanges. Those who have funds in BRL (Brazilian Real), can withdraw at any time, within the terms that were practiced while we were operating normally ”.

In addition to Bitcoin Access, the São Paulo exchange Latoex is also closing its doors. The report still tries to contact those responsible for the brokerage, which until June was called e-juno.

There is also Latoex Capital, the former investment arm of the Latoex exchange, from which it split in December 2019, and which remains in operation.

Federal Revenue Regulations

Without a proper law, until now the main regulation for the universe of cryptocurrencies in Brazil comes from Normative Instruction 1888. Implemented by the IRS in May 2019, it has been in force since August 1 of the same year.

According to the instruction, all transactions made by Brazilian exchanges must be reported monthly to the Federal Revenue Service, regardless of the amount.

If the broker does not comply or shows any inaccuracy in the declaration, he will have to pay a fine. The lack of declaration with the Revenue Service can cost R $ 500 or R $ 1,500 per month, being the first amount for companies opting for Simples Nacional.

Normative instruction also charges cryptocurrency companies for greater compliance, which leads to costs and requires adaptation for the entire market.

Despite criticism, cryptocurrency brokers heard by Bitcoin Portal at the time the IN came into effect they said they were following the changes. They also understood that the rules could represent a maturation of this market.

Projects under discussion

Both the Chamber and the Senate have proposals in progress that aim to regulate the sector and place it under the responsibility of the Central Bank. There are also proposals of a more punitive nature, directed especially at financial pyramids.

All projects, however, are still in the debate phase and are not expected to reach the floor for voting.

In the Chamber of Deputies the main one is Bill 2303/2015, authored by federal deputy Aureo Ribeiro (SD-RJ). It was archived at the end of 2018 – as is customary at the end of each legislature – and returned to the agenda last March, when a special commission was also created to analyze it.

In the Senate, there is PL 3825/2019, by Flávio Arns (Rede-PR), and PL 3949/2019, by Styvenson Valentim (Pode-RN) – the first of which is more advanced. Both aim to define rules for the market, with a focus on investor protection and the rules to be followed by brokers.

Disclaimer - OBN is an informational website which aims to give the latest blockchain related news to the readers. Articles on OBN should not be considered as investment advice. Trading cryptocurrencies is a high-risk investment, every user is advised to consult an expert before making any decisions.