Brazil addressed the issue of crypto regulation and as a result, implemented strict rules for crypto that affected many exchanges in the country. Two of the major cryptocurrency exchanges are now planning to shut their operations following the implementation of the new law.
$23,000 Fine for not following the Law
The new set of rules by the Brazilian government has also disturbed the low-level businesses related to cryptocurrency that cannot operate under such narrow conditions. Brazil’s Securities and Exchange Commission also announced to fine 100,000 Brazilian rial ($23,000) to that one who refused to align with the new tax regulations.
The decision by government financial law enforcement agency has put the crypto-financial institutions in a difficult situation. One who will give the wrong data about the company data will also be fined. Similarly, if any company failed to file a monthly declaration will be charged from 500 to 1500 rial.
Two Giant Exchanges are Badly Affected
However, there are many crypto-related firms working in Brazil but two of them officially announced to stop the process and asked users to withdraw their funds: one is Acesso Bitcoin and the other one is Latoex.
Acesso Bitcoin asked their users to withdraw their crypto funds: either transferring to another exchange or sending them to a safe wallet. Similarly, users who have funds in native currency, rial, can withdraw any time following the procedure provided by the exchange.
The Porto Alegre-based exchange is fleeing from the scene following the tough condition created by new tax laws. The co-founder of Acesso Bitcoin said,’’ After the Federal Revenue Service introduced these rules we noticed a significant decrease in the traded volume.’’
He also believes that, now, conditions are tough for small-level exchanges. As he commented,’’ We also feel that the market has cooled off for smaller exchanges.’’
The second affected crypto exchange is Latoex that is also known as Latin America Token Exchange. The CEO of Latoex Capital announced that they are shutting the exchange operations. The crypto exchange is planning to give funds back to the users while selling the company’s assets to other firms.
The Central Bank of Brazil is already laying out the regulatory structure in order to regularize the cryptocurrency in the country. Also, several other bills for the cryptocurrency are filed in the house of country National Congress.