Brazil’s Central Bank Crypto Policy: A Complete 2025 Guide

Key Takeaways

• The Brazilian Virtual Assets Law (BVAL) and Decree No.11,563/2023 make the Central Bank of Brazil the sole regulator for crypto services.
• All crypto firms must register as Virtual Asset Service Providers (VASPs) and follow strict AML/KYC rules.
• The 2025 $10,000 foreign‑exchange cap and stable‑coin restrictions are the biggest operational hurdles.
• DeCripto reporting and the DREX sandbox offer both compliance burdens and innovation opportunities.
• Tax, securities and anti‑money‑laundering oversight involve the RFB, CVM and COAF, creating a multi‑agency ecosystem.

Brazil has become a testing ground for large‑scale crypto regulation. Since the Federal Law No.14.478/2022 (the Brazilian Virtual Assets Law, or BVAL the law that first defined virtual assets and set the regulatory foundation) took effect in June2023, the Central Bank of Brazil (Central Bank of Brazil the country’s monetary authority that now supervises crypto service providers) has rolled out a multi‑layered framework. This guide walks you through the most relevant rules, how they affect everyday users and businesses, and where the market is heading in 2025 and beyond.

1. The legal backbone: BVAL and Decree No.11,563/2023

Under BVAL, virtual assets are treated as a distinct asset class. The law obliges every entity that offers buying, selling, custody or exchange services to register as a Virtual Asset Service Provider a regulated intermediary that must meet AML/KYC standards. Decree No.11,563/2023 operationalizes this requirement, giving the Central Bank the authority to issue registration numbers, conduct inspections and enforce penalties.

2. Core compliance pillars: AML, KYC and transaction monitoring

Brazil’s AML regime mirrors the FATF standards but adds local nuances. VASPs must:

1. Collect verified identity documents (CPF, CNPJ, proof of residence).
2. Run real‑time sanctions screening against UN, OFAC and Brazilian watchlists.
3. Maintain audit‑ready logs for at least five years.

The Financial Activities Control Council (COAF Brazil’s financial intelligence unit responsible for suspicious‑transaction reporting) receives mandatory SARs (Suspicious Activity Reports) from every VASP.

3. DeCripto: The new reporting engine

In March2025 the Central Bank launched the Declaration of Crypto Assets (DeCripto a mandatory monthly reporting framework for all crypto transactions). The system requires:

• Aggregated transaction volume per user, broken down by asset type.
• FX conversion details when Brazilian reais are exchanged for foreign fiat.
• Instant submission via an API that validates data against the BCB’s risk engine.

Non‑compliance triggers fines up to 0.5% of annual turnover and potential suspension of the VASP’s registration.

4. The $10,000 foreign‑exchange cap and stable‑coin rules

Effective April2025, any cross‑border transfer exceeding US$10,000 must be routed through a licensed foreign‑exchange institution, and crypto platforms cannot facilitate such transfers directly. This limitation pushes exchanges toward domestic‑only services, emphasizing BRL‑denominated pairs.

Stable‑coins, which account for roughly 90% of Brazil’s crypto volume, face extra scrutiny. The Central Bank has barred stable‑coins that are not fully backed by audited reserves and requires a separate license for any that operate as payment‑mediums. While the rule is still under public consultation, platforms have already delisted several high‑risk tokens.

5. Innovation space: Regulatory sandbox and DREX

The sandbox, introduced in 2024, lets approved firms test novel services-such as tokenized loans or real‑time settlement-under a temporary waiver of some reporting thresholds. Participants receive a “sandbox ID” and must submit weekly performance and risk metrics.

Parallel to the sandbox, the Central Bank is piloting the Distributed Ledger Exchange (DREX platform a permissioned ledger for tokenized bank deposits, loans and government securities). DREX is not a CBDC; it functions as an infrastructure layer that banks can use to issue and trade digital assets without moving funds off‑chain. Early pilots involve Banco do Brasil and Itau, with plans to expand to municipal bonds by 2026.

6. Multi‑agency coordination: CVM, RFB and tax obligations

The Securities and Exchange Commission of Brazil (CVM regulatory body overseeing securities, including tokenized securities) monitors crypto assets that qualify as securities. Their upcoming tokenization framework (consultation due September2025) will define disclosure, prospectus and investor‑protection rules.

For tax purposes, the Brazilian Revenue Service (RFB the tax authority that enforces capital‑gains reporting on crypto profits) requires annual filing of all crypto trades, using the “Crypto Gains” section of the declination form. Gains are taxed at 15% for up to BRL5million, 17.5% for the next bracket, and 22.5% above that.

7. Practical timeline for compliance

Getting fully registered and compliant typically follows this roadmap:

1. Month1‑2: Submit registration request to the Central Bank, including corporate documents, AML/KYC policies and IT security audit.
2. Month3‑4: Integrate DeCripto API, set up real‑time transaction monitoring, and train staff on SAR filing.
3. Month5‑6: Conduct a sandbox trial (optional) to test tokenized products or new settlement flows.
4. Month7‑12: Ongoing reporting, periodic audits, and alignment with CVM or RFB updates.

Established banks usually complete the process in 6‑8months; startups may need a full year due to limited resources.

8. Market impact and future outlook

Since the regulatory framework took shape, crypto adoption in Brazil has surged to over 30million active users, according to Central Bank data. Institutional investors are now comfortable allocating up to 5% of portfolios to tokenized assets because the legal certainty reduces counterparty risk.

Looking ahead, two developments will shape the ecosystem:

• Stable‑coin rule finalization: Expect a detailed licensing guide by late2025, which could either open the market to compliant stable‑coins or tighten restrictions further.
• DREX scaling: If pilots succeed, DREX could become the backbone for a nationwide “tokenized banking” layer, potentially influencing future CBDC discussions.

For businesses, the sweet spot lies in offering BRL‑centric services, leveraging the sandbox for innovative products, and maintaining a robust AML/KYC stack to stay ahead of regulatory changes.

Comparison of Key Regulatory Milestones

Frequently Asked Questions