Brazil Bans Cryptocurrency for International Remittances...Abandoning Efficiency and Reverting to the Past

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The Central Bank of Brazil has significantly strengthened its regulations by completely prohibiting the use of cryptocurrencies in international remittance systems.

According to the cryptocurrency specialized media Bitcoin.com on May 1st (local time), the Central Bank of Brazil announced Resolution No. 561 on April 30th, making virtual assets, including Bitcoin (BTC) and stablecoins, unusable for international payment and remittance services.

This regulation mandates that institutions performing international remittances and foreign exchange transactions must only use traditional foreign exchange systems. The resolution stipulates that international payments must be processed exclusively through foreign exchange transactions or Brazilian Real-based accounts, and the use of virtual assets is explicitly prohibited.

This measure will take effect on October 1st. The Brazilian authorities explained that the purpose is to prevent financial crimes, ensure transparency, and enhance alignment with international regulatory standards.

The targets of the regulation are financial institutions and payment service providers, not individual investors. Banks, fintech companies, and remittance companies can no longer use blockchain-based assets in international payment processes and must revert to existing financial infrastructure.

The market expects this measure to directly impact stablecoin-based remittance structures, which offered advantages in terms of efficiency and cost. One analyst commented, “The efficiency of on-chain payments will be blocked, and companies will return to traditional financial networks.”

While the Central Bank of Brazil has not completely banned virtual assets, it has chosen to exclude them from the officially controlled national payment infrastructure. This is interpreted as a policy decision reflecting the intention to directly control capital flows and ensure traceability.

This regulation is being received as a signal to clearly distinguish the boundaries between the virtual asset industry and the traditional financial system. With the utilization in international payment areas being blocked, changes in the business structures of related companies have become inevitable.

Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*