Central Bank Regulates the Provision of Virtual Asset Services
On 10 November 2025, the Central Bank of Brazil (“BCB”) published Resolutions Nos. 519, 520 and 521, setting out rules on the provision of virtual asset services. These rules, further detailed below, are the result of market input submitted in response to Public Consultation Notices (“PCNs”) issued by the BCB in 2023 and 2024 (i.e., PCNs Nos. 97/2023, 109/2024, 110/2024 and 111/2024).
(i) Authorization Process (BCB Resolution 519)
BCB Resolution 519 governs the authorization processes applicable to the operation of the following institutions:
(a) foreign exchange brokerage companies;
(b) securities brokerage companies;
(c) securities distribution companies; and
(d) companies providing virtual asset services (“SPSAVs”, from the Portuguese acronym).
This regulation sets out the requirements for obtaining authorization from the BCB for the above-mentioned entities to commence operations. Among the main requirements are the lawful origin of funds, the viability of the business, and the compatibility of corporate governance and technological infrastructure with the complexity of the operations. The regulation also details the procedures applicable to obtaining such authorization to operate, as well as the circumstances and procedures adopted by the BCB for its review, suspension or cancellation.
The regulation further identifies the requirements for holding management positions in the institutions it covers, as well as for individuals or entities wishing to join the controlling group or hold a qualifying shareholding in such institutions. These requirements are broadly aligned with those already in place for obtaining other licenses that are likewise subject to BCB authorization.
For companies that are already providing services related to virtual assets, the regulation establishes a two-phase authorization procedure, as follows:
• Phase 1: This phase consists of verifying that the SPSAV is effectively operating on the date BCB Resolution No. 519 enters into force, as well as verifying compliance with the specific rules governing the incorporation and operation of such companies. At this stage, compliance with the requirements set out in Chapter V of the Resolution is examined, including the conditions for holding management positions, acquiring control or a qualifying shareholding, and evidence of compliance with the minimum capital and equity requirements.
• Phase 2: This phase involves the analysis of compliance with the remaining requirements set out in the Resolution, including, among other aspects, the economic and financial capacity of the controlling shareholders, the lawful origin of the funds used to pay in the share capital, and the economic viability of the business, as provided for in Article 2.
(ii) Regulation of Operations (BCB Resolution 520)
BCB Resolution 520, in turn, governs the incorporation and operation of SPSAVs and of other institutions authorized to operate by the BCB that also provide virtual asset services (“Authorized Institutions”). This rule specifically addresses the organizational structure and activities of virtual asset service providers, establishing that their operation is conditional upon incorporation in Brazil, with their head office and management located within Brazilian territory.
The regulation defines important concepts for the virtual asset market, such as stablecoins, virtual asset wallets and smart contracts. It also classifies SPSAVs into three distinct categories of activities, with the following main functions:
• Virtual asset intermediaries: conduct intermediation, trading and underwriting;
• Virtual asset custodians: are responsible for the safekeeping, control and movement of private keys; and
• Virtual asset brokers: perform both intermediation and custody functions.
BCB Resolution 520 also details corporate aspects relating to incorporation, name, capital structure, as well as the obligations and responsibilities of SPSAVs and Authorized Institutions. Virtual asset service providers must maintain a robust governance framework, internal control policies, security measures and procedures, and segregation of financial resources and virtual assets between their own assets and those of their clients.
It is important to note that the regulation allows financial institutions already supervised by the BCB — such as commercial banks, exchange banks, investment banks and multiple banks, as well as securities brokerage and distribution companies — to provide virtual asset intermediation and custody services, subject to a formal notice to the BCB and an independent technical certification (to be further regulated). In this regard, the effective provision of such services is conditional upon submission of the notice and the lapse of a 90 (ninety) day period thereafter, so that the BCB may confirm that the Authorized Institution complies with the requirements set out in the specific regulation.
Companies that are currently providing virtual asset services, particularly intermediation and/or custody of such assets, must comply with BCB Resolution 520 by filing an application for authorization to operate with the BCB. Such application must be submitted within 270 (two hundred and seventy) days from the date the Resolution enters into force (i.e., 30 October 2026), and must comply with the requirements set out in the regulation.
As regards entities incorporated abroad that are engaged in virtual asset market activities in Brazil when the new rule enters into force, their regular operation in the country will require the transfer of their operations and clients to an SPSAV or to an Authorized Institution within the same 270 (two hundred and seventy) day period from the date BCB Resolution 520 enters into force.
BCB Resolution 520 expressly requires that virtual asset service providers keep both their own financial resources and virtual assets segregated from those of their clients and users, implementing mechanisms and procedures capable of ensuring such segregation. In addition, the Resolution expressly prohibits virtual asset service providers from using assets owned by their clients, users or other business counterparties to conduct proprietary transactions, subject to specific exceptions.
The Resolution further sets out conditions under which virtual asset service providers may enter into outsourcing arrangements for “relevant services”, understood as services that affect the performance of the provider’s activities or that affect, or may affect, the full exercise of the rights of clients or users of the virtual asset service provider. Among the conditions for entering into such arrangements, the following may be highlighted:
(i) verification of the capability of the service provider being engaged;
(ii) joint establishment, with the service provider, of internal controls suitable for monitoring the prevention of risks associated with money laundering, financing of terrorism and proliferation of weapons of mass destruction; and
(iii) compliance with the specific rules applicable to the categories and activities described in BCB Resolution 520, among others.
In addition to the matters mentioned above, BCB Resolution 520 is broad in scope and addresses several other topics, including governance in the provision of services by virtual asset service providers, the requirement to maintain cybersecurity policies, the minimum number of officers required for such companies, and the levels of controls that must be observed with respect to anti–money laundering and counter–terrorism financing measures, among others.
(iii) Impacts on the Foreign Exchange Market and on the Regulation of Foreign Capital in Brazil and Brazilian Capital Abroad (BCB Resolution 521)
Finally, BCB Resolution 521 includes the following transactions involving virtual assets within the scope of the Brazilian foreign exchange market:
(I) international payments and transfers;
(II) transfers of virtual assets to or from clients to settle obligations arising from the international use of cards or other electronic means of payment;
(III) transfers of virtual assets to or from self-custodied wallets that do not involve international payments or transfers in virtual assets; and
(IV) the purchase, sale or exchange of virtual assets referenced in fiat currency.
In this regard, it is also important to note that Authorized Institutions will be subject to specific limits for carrying out such transactions in the foreign exchange market. For these providers, international payments or transfers of virtual assets involving counterparties that are not authorized to operate in the foreign exchange market are limited to the equivalent of US$ 500,000. In the case of SPSAVs, in addition to being prohibited from carrying out transactions involving physical currency (domestic or foreign), international payments and transfers involving virtual assets with counterparties not authorized in the foreign exchange market are limited to US$ 100,000.
With a view to protecting users and the system as a whole, the regulation further requires virtual asset service providers to identify the owners of self-custodied wallets and mandates verification, for all transactions, of documentation evidencing the origin and destination of the assets.
In addition, transactions involving virtual assets that may be used to carry out external loans or foreign direct investment must comply with the requirements set out in BCB Resolution No. 278 (on external loans and foreign direct investment). Likewise, transactions involving Brazilian capital invested abroad in virtual assets must comply with BCB Resolution No. 279, which governs flows, stocks and reporting obligations in relation to Brazilian capital abroad.
The new regulations represent a significant step forward in the regulation of virtual assets, whose relevance has been growing exponentially. The provisions establish parameters aimed at transparency, integrity, information security and the delineation of operational practices, thereby strengthening the regulatory framework.
All the Resolutions discussed herein will enter into force on 2 February 2026, except that part of the amendments introduced by BCB Resolution 521 — namely, those that make it mandatory to report foreign exchange transactions and foreign capital transactions in Brazil to the Central Bank — will become effective as from 4 May 2025.
