In a recent move, the Brazilian Federal Revenue has announced plans to step up its monitoring of foreign cryptocurrency exchanges operating within the country. This initiative is aimed at ensuring that these platforms are in compliance with the regulations established in 2019. The exchanges will be required to provide detailed information about their interactions with local service providers to ensure adherence to the law.
Andrea Chaves, the Undersecretary of Inspection at the Federal Revenue, voiced the agency’s concern, stating, “It is important for us to understand how foreign cryptocurrency exchanges are operating in Brazil and whether there are any illegal activities taking place.”
Furthermore, the IRS is set to gather comprehensive data on cryptocurrency assets held by Brazilians that are subject to taxation. A decree calling for cooperation from exchanges is expected to be issued by the end of the week to formalize this process.
It is worth noting the distinction between the obligations imposed on domestic and foreign platforms, as only local companies are currently required to report their transactions directly to the IRS. Notable international exchanges operating in Brazil include Binance, Coinbase, OKX, and KuCoin, among others.
The cryptocurrency market in Brazil has witnessed significant growth, as reported by the IRS. In the first half of 2023, individuals and legal entities declared a total of 133.6 billion reais (approximately US$24.6 billion) in cryptocurrencies, with 14.5 billion reais (approximately US$2.7 billion) attributed to foreign exchanges. These figures represent an increase of 36.6% and 51.2%, respectively, compared to the same period in the previous year.
Disclaimer: The opinions expressed in this article are for informational purposes only and do not constitute financial or investment advice. Investing in cryptocurrencies carries a risk of financial loss.
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