#154: Receita Federal to tighten crypto tax reporting rules
Plus: Binance CMO stumps in Brazil, Mercado Pago offering Mercado Livre stablecoin
Olá pessoal!
Welcome back to 🇧🇷Brazil Crypto Report for the week of August 19-23!
We had a nice pump in the market over the weekend thanks to signals from the Fed that a September interest rate cut is likely (despite the US Bureau of Labor Statistics revising down its jobs estimates by 800,000 for the year ending March 2024 😱).
Friday’s news that crypto-friendly presidential candidate Robert F. Kennedy would be suspending his campaign and backing Donald Trump (who’s also come out as pro-crypto) also added to the positive momentum.
There’s tons of debate right now on crypto X/Twitter land about how much this US presidential election means for the industry. It’s a lot of sensationalism but you definitely need to be paying attention!
Lots of news this week so let’s dive in!
🔍What’s in BCR this week?
Receita Federal to update crypto tax declaration rules
Binance marketing chief Rachel Conlan made the rounds in Brazil
Influencers Tiago Reis and Richard Rytenband face off in an epic debate on the future of bitcoin
Brazilian SEC approves 2nd Solana ETF
Mercado Pago offers Mercado Livre stablecoin in Brazil
Thanks for reading and have a great week!
-AWS
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Receita Federal to update crypto tax declaration rules
The Receita Federal, Brazil’s tax authority, expects to announce its Cripto Conforme program later this year.
The new rules would impose new tax compliance requirements for overseas crypto exchanges by amending Normative Instruction 1.888, which was enacted in 2019 and created requirements for exchanges to report customer activity to the Receita Federal.
The changes will help bring Brazil up to international standards known as the Crypto-Asset Reporting Framework, which was developed by the OECD.
The Receita Federal has been probing the business model and operations of both domestic and overseas crypto exchanges in recent months in an attempt to crack down on tax evasion.
According to Leandro Genaro of Santos Neto Advogados, the program will create a more user-friendly means by which overseas exchanges and wallets can report user transactions to Brazilian authorities. This would create an even playing field for domestic and foreign exchanges as far as tax reporting requirements are concerned.
He told CoinTelegraph Brasil:
"Its inspiration is 'Remessa Conforme', through which the Government began to have greater control over low-value international purchases, especially those made through Chinese websites."
CoinTelegraph Brasil Exame BlockNews BeinCrypto Portal do Bitcoin BeinCrypto
Binance marketing chief stumps in Brazil
Binance chief marketing officer Rachel Conlan made the media rounds in Brazil last week, speaking with CoinTelegraph Brasil, Exame BlockNews and more.
Her pitch was that Brazil is a critical market for the exchange to reach its target of 1 billion users globally.
She told CoinTelegraph Brasil:
"Brazilian users are definitely the protagonists in this market. For us at Binance, Brazil is among the top ten markets in the world and the growth potential is still enormous. Even with an impressive 8% of users, there is still 92% of the population that has not been captured.”
She reframed Binance’s positioning in the market as less of an exchange and more of a gateway to the Web3 world and decentralized economy.
Conlan also iterated that Binance’s marketing blitz in Brazil, including its sponsorship of the Brasileirão football tournament, has been extremely successful.
"Football fans are often obsessed and passionate about their clubs and idols. Using sports and entertainment as a way to connect with our users has been fundamental to strengthening our communities in Brazil and around the world.”
Notably, she pointed out that Brazil has the second highest usage of Binance’s copytrading feature, showing that Brazilians are more sophisticated users of the platform.
Overall, she added that Binance and the industry more broadly needs to be investing more heavily in markets like Brazil:
“I think we need to invest more in markets like Brazil and Vietnam, which can be global references and create new standards.”
She also revealed that new Binance CEO is expected to visit Brazil and other Latin American countries by the end of this year.
Tiago Reis vs Richard Rytenband on the future of bitcoin
Two popular Brazilian financial influencers debated the future of bitcoin for two hours on the Market Makers podcast, a popular program among Brazil’s TradFi community. Reis has been a long-time bitcoin skeptic, while Rytenband is among Brazil’s most prominent bitcoin supporters.
The conversation covered the future and viability of bitcoin, bitcoin as a financial revolution, security and regulation and adoption and use cases.
The video has attracted 61,000 views on YouTube thus far. Worth listening in while you’re at the gym!
CVM approves 2nd Solana ETF
Brazil’s securities regulator approved a second Solana spot ETF, this one from Hashdex and BTG Pactual.
The fund will track the Nasdaq Solana Reference Price Index (NSOL), be managed and custodied by BTG Pactual and has retained Ernst & Young as an auditor.
The CVM approved a Solana spot ETF proposal from QR Asset earlier this month and is scheduled to begin trading on the B3 exchange this coming week.
Theodoro Fleury, investment manager and director at QR Asset, told Portal do Bitcoin:
“QSOL11 is not only an important step for QR Asset, but also a clear sign that Brazil is positioning itself as a leader in the crypto asset market. As a market player, it is comforting to have Brazilian regulators so attentive and open to the evolution of the crypto ecosystem in a regulated environment.”
CoinTelegraph Brasil Livecoins Valor Investe BeinCrypto BlockTrends
Mercado Pago offers Mercado Livre stablecoin in Brazil
Mercado Pago, which is the payments arm of e-commerce giant Mercado Livre, announced that it will allow the purchase and sale of the Melí Dollar — Mercado Livre’s USD pegged stablecoin — directly inside the Mercado Pago app.
Andre Chaves SVP of Mercado Pago said in a statement.
“Meli Dólar joins the operation as another open solution from Mercado Pago, which has a unique ability to scale financial products and services for everyone. Attentive to the evolution of crypto assets, the Mercado Livre group's digital bank continues to offer solutions to democratize access to the crypto universe and promote innovation and financial development for users."
Crypto exchange Ripio will serve as market maker and exchange for transactions carried out using Melí Dollar through the Mercado Pago app. Meli Uruguay S.R.L. will be the official issuer.
Sebastian Serrano, CEO and co-founder of Ripio, said in a statement:
"We are excited to contribute with a safe and accessible solution for Mercado Pago users in Brazil who, among other factors, want to protect their purchasing power, in a time of economic volatility. As an exchange and custodian of operations, Ripio plays an important role in ensuring the security and efficiency of this stablecoin, strengthening users' trust in the digital environment.”
Mercado Pago stated that it will not charge fees to customers who use the Melí Dollar for payments in its app. It currently offers the Pax Dollar, issued by Paxos, to its customers as well.
CoinTelegraph Brasil CriptoFacil Livecoins InfoMoney Valor Investe Portal do Bitcoin BeinCrypto
🗞Brazil Crypto News Rundown
📈 Markets
Patria Investimentos invested R$11 million (US$2.2 million) in tokenization and infrastructure firm Liqi as an extension of its Series A round. It was the first investment out of a newly launched crypto fund. Liqi has now received R$57.25 million (US$11 million) in funding with a valuation near R$200 million (US$40 million). Pedro Sirotsky Melzer, partner at Patria, said in a statement:
“Liqi's solutions increase the efficiency of financial instruments that until now work in a very analog way, running on Excel spreadsheets and with paper contracts. The technology developed by the company allows all of this to be done automatically within the blockchain infrastructure, with agility, lower costs and with the necessary security.” (CoinTelegraph Brasil) (Valor)
PicNic, a Brazilian-founded DeFi platform, won a grant from Polygon to expand into the European market. The funds will come from Polygon’s Community Treasury. Co-founder João Ferreira told CoinTelegraph Brasil in an interview:
"We are exploring a new frontier, building an innovative product whose growth in Brazil shows that PicNic has great market and expansion potential, and the launch in the European market was already in our focus. The Polygon community recognized this and we were awarded it."
Tokenized crowdfunding platform SMU Investimentos recently launched a $1 million (US$200,000) fundraise for SuperOpa, a startup focusing on reducing food waste. The minimum investment is R$3,000, with each tokens valued at R$10 each. (CoinTelegraph Brasil) (BeinCrypto) (Valor)
Ney Miyamoto, formerly of Alaska Investimentos, has joined B2V Crypto (formerly BLP Crypto) as director of distribution and investor relations. He said in a statement:
“B2V is a pioneer in the Brazilian market, and was largely responsible for the sector’s development and the expansion of crypto’s presence in the country’s most strategic and profitable funds.” (Valor)
The Alby Foundation announced its intent to acquire ZCore Network, a Brazilian DeFi protocol and ecosystem. (CoinTelegraph Brasil)
Brazilian ETFs linked to cryptocurrency and artificial intelligence have outperformed the market average so far in 2024, but the market remains relatively underdeveloped as just 0.5 percent of Brazilian investors’ portfolios have allocations in ETFs. Steven Schoenfeld, CEO of market index provider Market Vector, told NeoFeed:
"Brazil is the last major asset management market that has not yet matured in terms of ETFs, and this is clearly an opportunity we want to take advantage of.” (CoinTelegraph Brasil)
Mercado Bitcoin launched a smart basket of memecoins with an automated allocation strategy for users looking for easy exposure to the asset class. (CoinTelegraph Brasil) (Portal do Bitcoin)
A new panorama report by Bitso shows that Brazilians prefer crypto trading on the 5th and 8th of the month and typically around mid-day. Bitso has more than 8 million customers across Latin America, and registered 18 percent user growth in Brazil during the first half of the year, it stated in the report. (BlockNews) (BlockTrends)
The report also finds that Brazilians are the largest holders and traders of memecoins in the region. (CoinTelegraph Brasil)
QINV, a Brazilian fintech inspired by the likes of Robinhood and Stash, announced the launch of a new RWA token on the tokenized crowdfunding platform Raketo. The fundraise aims to raise $1 million (US$200,000) to reach the 150,000 user mark. CEO Lucas Lendel said in a statement:
“At QINV, we have always believed in the democratization of investments, and this round of crowdfunding in partnership with Raketo is a step forward in this mission. We are offering anyone the opportunity to invest in our company with just R$500, something that has never been possible before, and thus participate directly in our success.” (CoinTelegraph Brasil)
📲 Adoption
Polkadot announced a strategic partnership with the Federal Technical University of Parana to develop new crypto education programs. (CoinTelegraph Brasil)
Proton VPN reported that Brazilian users were having a hard time downloading in the App Store, adding to rumors that an Elon Musk-inspired crackdown on VPNs may be in the works.
The Central Bank of Brazil has received more than 40 use case proposals for the second phase of Drex, Wallace Jagiello — technical director of ABBC (Brazilian Association of Banks) — said during a panel. The use cases were proposed by the consortiums that participated in the first phase of the project. (CoinTelegraph Brasil) (BeinCrypto) (Valor))
The Bank is expected to announce the participants in the second round of the Drex pilot in the coming weeks. Notably, other regulators such as the CVM will be invited to join the network in an effort to break down siloes. (BlockNews) (BeinCrypto)
The Brazilian Blockchain Network (Rede Blockchain Brasil) which is a joint project between BNDES and the Federal Audit Court (TCU) may open up to the public in 2025. The TCU stated that the RBB is:
"is ready to transform several areas through innovative applications, promoting transparency and efficiency in processes of public interest" (CoinTelegraph Brasil) (Exame) (Livecoins)
Asset tokenizer Hurst Capital has been the target of a wave of complaints related to delayed dividend payouts, sometimes by as long as three years. There are more than 30 complaints registered on Reclame Aqui in the last five months. (Portal do Bitcoin)
🏛 Policy, Regulation and Enforcement
Brazilian authorities are creating a system called CriptoJud that would be capable of blocking any digital asset owned by Brazilians on a crypto exchange. Frederico Montedonio Rego, an auxiliary judge at the National Council of Justice, said at an event in Brasilia:
“We need to face the new reality. Today, there are no legal accounts for cryptocurrencies like there is, for example, a legal account for blocking financial assets. The workforce of the prosecutors' offices is limited, so we need to prioritize our efforts to obtain the best results in tax enforcement.” (CoinTelegraph Brasil)
Federal Police launched Operation Gold Digger against a criminal group that defrauded R$15 million (US$3 million) from the government and launder the funds via cryptocurrency. 19 search and seizure warrants were executed in Minas Gerais, Bahia, Rio de Janeiro , São Paulo and the Federal District. (Portal do Bitcoin) (BeinCrypto) (Livecoins)
Ricardo Lewandowski, Minister of Justice and Public Security, said that cryptocurrencies are being used for illegal activities and that this is an area that needs to be explored.
“Payment for drugs trafficked across borders, human trafficking, illegal mining, illicit logging, all of this is now paid for no longer in cash, but through cryptocurrencies. It is a new world, a world to be explored and that is why we need new tools.” (Valor)