Latest News

A sandbox for tokenization is planned by the Brazilian securities authority for 2024.

During the Rio Innovation Week, Daniel Maeda from Brazil’s CVM announced the regulator’s intention to explore the concept of a regulatory sandbox, with potential implementation commencing in 2024. The Comissão de Valores Mobiliários (CVM) of Brazil is charting a course to initiate its second regulatory sandbox program in the year 2024.

Addressing the audience at the Rio Innovation Week on October 4th, Daniel Maeda, the superintendent overseeing institutional investor supervision at CVM, divulged that the regulator is embarking on a journey to delve into the realms of a regulatory sandbox, with a focus on tokenization use cases. This endeavor is tentatively slated to commence in 2024. Maeda shared that the decision to proceed with a second sandbox initiative stems from the positive outcomes of their initial experience, during which approximately $36 million worth of assets were successfully tokenized.

“We intentionally refrain from defining specific use cases, as our aim is to allow innovation to flourish within the CVM without any predetermined constraints,” remarked Maeda in an interview with Cointelegraph Brasil. “However, certain domains for tokenization application have indeed captured our attention, notably agribusiness and environmental, social, and governance (ESG) initiatives.”

Expounding on the CVM’s strategy, the superintendent mentioned that they plan to observe the evolution of Brazil’s crypto market, especially in relation to the country’s central bank digital currency, the Drex. According to Maeda, both the securities regulator and the central bank should closely monitor developments within the digital asset space, taking cues from how other nations have approached regulation.

“I hold the United States Securities and Exchange Commission (SEC) in high regard, and I refrain from passing judgment on whether their stance is right or wrong,” Maeda remarked. “What I can affirm is that, at CVM, we have identified numerous advantages in this market that can streamline processes. Through tokenization, investors stand to benefit from enhanced transparency, reduced costs, and increased democratization of investments. These values resonate deeply within our commission’s mission.”

Brazil’s central bank took a significant step in October, introducing stricter regulations in response to the burgeoning adoption of cryptocurrencies within the country. Governor Campos Neto explicitly highlighted concerns about potential links between cryptocurrency usage and tax evasion or illicit activities.

Back in June, Brazilian President Luiz Inácio Lula da Silva enacted a comprehensive framework into law, defining the distinct roles of the country’s central bank and the CVM in overseeing digital assets. Looking ahead to November, Brazil is set to launch a program for issuing identification documents via a private blockchain, aligning with their commitment to safeguard personal data and combat fraud.

Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Crypto is not a legal tender and is subject to market risks. Readers are advised to seek expert advice and read offer document(s) along with related important literature on the subject carefully before making any kind of investment whatsoever. Crypto market predictions are speculative and any investment made shall be at the sole cost and risk of the readers.