Another country is offering friendly regulations for institutions to invest in cryptocurrencies. According to Brazil’s securities regulator, the Comissao de Valores Mobiliários (CVM), investment funds in the country can indirectly invest in cryptocurrencies. It is possible for companies to acquire derivatives and foreign funds.
Brazil Creates Opportunities for Institutional Investors
As per the circular released some days ago, the CVM is easing current regulations for institutions to invest in the crypto market. The agency explained that it does not prohibit indirect investments in cryptocurrencies in foreign funds. However, these investments should be regulated in the country where they are traded.
The circular explains that the instruction number 555 does not forbid investments in crypto assets. However, the CVM marks that its job is to go behind illegal activities that take place in the market. Some of these issues are related to money laundering activities, market manipulation or funding criminals.
This decision is very important. Until now, institutions were not able to invest in the crypto market. Indeed, they do not trust current companies and their products. In the near future, the Intercontinental Exchange (ICE) will be launching a crypto platform known as Bakkt. With it, investors would be able to trust an already established financial institution.
At the same time, during the last months, the U.S. Securities and Exchange Commission has delayed the approval fo a Bitcoin ETF. A crypto ETF would allow new investors to place their funds on the market. The first Bitcoin ETF could be approved before February 2019.
Brazil has a very powerful economy that is becoming interested in cryptocurrencies. Blockchain technology is also attracting investors in the country. At the moment, Foxbit, the largest cryptocurrency exchange in the nation has 400,000 users.
Additionally, Grupo XP announced its plans to offer Bitcoin and Ethereum on its platform. The company wants to be one of the first movers in the market. The company PundiX has also decided to launch its product in Brazil and benefit from its large and growing crypto economy.
This shows that there is a genuine interest in Brazil for virtual currencies. It will be important to follow the results of these policies in the middle and long term.
Carlos is an international relations’ analyst specializing in cryptocurrencies and blockchain technology. Since 2017, Carlos has written extensively for UseTheBitcoin and other leading cryptocurrency sites; with over 2,000 articles published.