The Brazilian Senate's economic affairs committee approved a bill Tuesday regulating crypto transactions.
The bill, introduced by Senator Flávio Arns, has to be voted on by the Senate plenary and, if approved, then by the Brazilian Chamber of Deputies. The executive branch then has the power to veto the bill.
After approving Arns' bill, the Brazilian Senate shelved two other crypto bills presented by senators Styvenson Valentim and Soraya Thronicke.
The bill presented by Arns creates the label "virtual service providers" for crypto companies, which will be subject to criminal liability for violations against the Brazilian financial system.
Arns’ bill keeps the Brazilian Securities and Exchange Commission from supervising the Brazilian crypto ecosystem – except for initial coin offerings (ICO) ≠ and allows the Brazilian executive branch to choose a supervisor.
In the bill, Arns also proposes joint overview of crypto between the Brazilian Central Bank and the tax collection agency, Receita Federal.
If the bill is approved, the executive branch will provide crypto companies with authorization to operate. In addition, crypto firms will have to notify the Brazilian Financial Activities Control Council of transactions suspected of money laundering.
The bill also specifies a new crime carried out with virtual assets, punishable by a penalty of between four and eight years in prison and a cash fine.
Until 2029, the bill exempts from taxation purchases of machinery and software for processing, converting and mining cryptocurrencies by companies that neutralize 100% of emissions.
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