Brazilian CVM Vetoes Acquisition of Bitcoins by Local Investment Funds

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The Brazilian Securities and Exchange Commission (CVM) has decided to not allow local investment funds to directly acquire bitcoins and other criptocurrencies by . On the other hand, the commission does not yet have a conclusion on investments in the modality through funds abroad, in places where the operation is already allowed.

The orientation from the Institutional Investor Relations Superintendency (SIN) is for the market to wait for a later and more conclusive report from the technical area, which should occur only in March.

The regulator’s guidance is in a statement released on Friday (12). The CVM recalls that Brazil and other countries have discussed the legal and economic nature of these investment modalities, without a final conclusion on the concept, especially in the “domestic market and regulation”.

“Thus, based on this uncertainty, the interpretation of this technical area is that the crypto-coins can not be qualified as financial assets … and for this reason, their direct acquisition by the regulated investment funds is not allowed”, says the document.

The CVM also received consultations on the possibility of setting up investment funds in Brazil with the objective of investing in other vehicles abroad that invest in cryptocurrencies. Or, to invest in derivatives created in regulated environments in other jurisdictions.

In the letter, CVM reminds that the existing discussions about the investment in crypto-currencies, either directly by the funds or in other ways, are still at a very incipient level. The document cites Bill 2.303 / 2015, which, if approved, may prevent, restrict or criminalize the negotiation of these investment modalities.

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