Brazil is proactive in embracing cryptocurrencies and global crypto markets, with greater attention being paid to major exchanges such as Binance, Coinbase, OKX, and KuCoin. These platforms have been requested to provide details about their operations and partnerships with local service providers, particularly regarding compliance with tax legislation.
Unlike some local companies, businesses located in other countries are not subject to Brazilian laws that require them to provide information to regulatory authorities about their operations. The seriousness of this issue has been emphasized by the Brazilian tax authority. Andrea Chaves, Deputy Secretary of Inspections at Brazil’s Federal Revenue Service, stated:
“It is very important for us to investigate their activities in this country and determine if any illegal activities are being carried out. We are also interested in learning about the wealth of Brazilians, which is subject to taxation.”
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Wagner Lima, Risk Management Coordinator at the Revenue Service, shared that the government aims to understand how these international players collaborate with local providers in implementing the provisions of 2019.
What we are witnessing now is hardly an isolated case. Brazil has seen a significant increase in crypto transactions. From January to July 2023, Brazilians conducted cryptocurrency transactions worth $24.6 billion, representing a 36.6% increase compared to the previous year. Particularly, $2.6 billion is attributed to operations through foreign exchanges, which is 51.2% higher than the volume in 2022.
