Brazil's Securities Commission Plans Second Regulatory Sandbox for Tokenization by 2024
Summary:
Brazil's Securities Commission (CVM) plans to launch a second regulatory sandbox aimed at tokenization use cases by 2024, following a successful experience tokenizing about $36 million in assets. CVM's Daniel Maeda revealed that no specific sectors have been earmarked for the scheme in a bid to allow innovation to reach the CVM without pre-existing boundaries. Prior to implementing the sandbox, substantial changes related to Brazil's crypto industry will be anticipated, including those concerning Brazil's digital currency, Drex, according to Maeda.
Brazil's Securities Commission (Comissão de Valores Mobiliários - CVM), intends to commence a second regulatory sandbox scheme by 2024. The disclosure was made at Rio Innovation Week on October 4 by Daniel Maeda, the Institutional Investor Oversight Supervisor with CVM. He stated that the regulatory body is considering introducing a regulatory sandbox for tokenization use cases, likely to start in 2024. The push for a second sandbox is due to the successful experience from tokenizing an estimated $36 million in assets, according to Maeda. He stated to Cointelegraph Brazil that they don't set specific cases as they want the innovation to reach the CVM without any pre-existing boundaries. He pointed out sectors like agriculture and Environmental, Social, and Governance as potential areas of interest for the tokenization application.
The CVM will wait until changes related to Brazil’s cryptocurrency industry, including amendments for the nation's digital currency, the Drex, are executed. As per Maeda's statement, both the securities regulator and central bank are to heed advancements in the virtual asset field and evaluate how other nations have controlled it. Maeda showed high regard for the U.S. SEC but refrained from commenting on their stances. He only ensured that the CVM saw potential in leveraging processes in this market. Through tokenization, investors can benefit from improved transparency, reduced costs, and better access to investments, according to Maeda, these are values upheld by the commission.
The central bank of Brazil has announced stringent regulations in October, given the notable rise in cryptocurrency usage within the country. Governor Campos Neto, in particular, highlighted the associated risks with tax evasion or unlawful activities. Brazilian President Luiz Inácio Lula da Silva sanctioned a legal framework in June, outlining the diverse part the nation's central banks and the CVM would play in the control of virtual assets. In November, Brazil expects to launch a project which issues identification documents via a private blockchain, as a means to safeguard personal information and obstruct fraud.
Published At
10/9/2023 9:16:41 PM
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