Brazil is set to summon some of the biggest international crypto exchanges, such as Binance and Coinbase, to gather information on their operations and partnerships with local crypto service providers.
The tax authorities in Brazil are targeting exchanges like Binance, Coinbase, OKX, and KuCoin, which are not based in the country but are actively operating there. They plan to issue an ordinance this week requesting these exchanges to provide details on how they function in Brazil and whether Brazilian citizens are adhering to the new tax laws.
Andrea Chaves, the deputy secretary of inspection at Brazil’s revenue service, highlighted the importance of understanding the operations of these exchanges in the country to ensure compliance with tax regulations and to track Brazilian wealth subject to taxation.
The Brazilian government is particularly interested in how foreign exchanges like Binance and Coinbase collaborate with local crypto service providers. For example, Binance partnered with Mastercard to introduce the Binance Card in Brazil last year, indicating the significance of the Brazilian market for the exchange.
Brazil has been experiencing a surge in cryptocurrency adoption, with one in five Brazilians owning digital assets. According to a report by Metaco, the country’s fintech ecosystem has played a significant role in driving crypto adoption, with projected digital asset revenues of $1.5 billion by 2027.
Moreover, Brazil’s revenue service data revealed a substantial increase in declared crypto assets in 2023 compared to the previous year. To regulate the growing crypto market, Brazil’s Central Bank and the Securities and Exchange Commission are working together to protect consumers and combat financial crimes.
In light of these developments, Brazil remains a key market for international crypto exchanges like Binance and Coinbase, who continue to invest in new services for local users.
