Brazil’s securities regulator asks Mercado Bitcoin to clarify token information: Estadão

  • Brazil’s Securities and Exchange Commission (CVM) has requested information from Mercado Bitcoin about its fixed-income token offering, local newspaper Estadão reported.
  • Mercado Bitcoin offers a number of fixed-income ERC-20 tokens on its website.
  • The announcement comes as Brazil’s securities regulator plans to issue its own guidance for crypto companies.

Mercado Bitcoin confirmed it received a request from Brazil’s securities and exchange commission that local news outlet Estadão reported yesterday regarding their fixed-income token offering.

While a spokesperson for the Brazilian cryptocurrency exchange confirmed the communication, it did not say how the plan would proceed.

We do not conduct a public offering of securities outside of the mandate we have as an authorized crowdfunding and investment management platform,” the company said in a statement. published in Portuguese, adding that it supports the regulation of digital asset service providers.

Mercado Bitcoin, which offers over 200 types of digital assets to more than 3.8 million customers, has recorded a total of more than 40 billion reais transactions in 2021 (about $7.44 billion at exchange rates). nowadays). Among them are a variety of fixed income tokens available through the ERC-20 token standard. They require a minimum investment of 100 Brazilian reais ($18.60) and advertise double-digit returns depending on the property.

The regulator wants to know how much Mercado Bitcoin has raised in these token offerings since January 2020 and whether it will continue to offer them, Estadão reported. It also wants to see a list of investors who have bought back the property and how much they have invested.

“Regarding so-called non-security tokens (tokens that do not represent securities), we are careful not to violate the scope of actions of authorized entities, including engaging in consult with the regulator about the structure to be used for those tokens, at the start of our operations in 2020,”.

said Mercado Bitcoin.

CVM does not comment on specific cases, a spokesperson told The Block. However, the regulator has confirmed that it requests more information as needed if potential securities-related transactions are identified.

CVM said that “whenever necessary and in particular, when identifying possible transactions with potential characteristics of securities, engages in interactions with participants to request information to the public.” the analysis of the facts and the appropriate measures.”

CVM is also working on a set of guidelines for crypto companies to better orient themselves on securities rules, which these companies still have to follow despite the country’s lack of asset regulations. digital.

“CVM is preparing an advisory opinion that will have a general directive on the subject,” the regulator told The Block earlier this month.

“It is not, at least for the time being, a regulation, as there is currently no one,” CVM said in the statement. “The document will be described as providing recommendations and guidance to the market.”

Cointelegraph Brasil, which first reported that CVM is preparing instructions, wrote that they will arrive last week. However, the regulator said it has yet to set a date.

Read more: Fed Chair Jerome Powell Update on Work on Digital Dollar – US Central Bank Says US Central Bank Digital Currency will take ‘at least a couple of years’

The cryptocurrency regulation bill in the Brazilian Congress has hit major milestones this year, but it has stalled in the lower house since the Senate approved the proposal in April. The bill is likely to No progress has been made before the country’s presidential election on October 2.

Brazil’s securities regulator is said to have opened the door to cryptocurrencies. It has enabled exchange-traded funds for cryptocurrencies and even launched a regulatory sandbox for fintech companies. But at the same time, it has cracked down on crypto companies under certain circumstances.

Earlier this month, CVM blocked cryptocurrency exchange Bybit from operating as a stockbroker. It also told Binance in 2020 that it could not offer derivatives products domestically.

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