Digital Real and Crypto Asset Regulation FAQ The Central Bank of Brazil's official FAQ on digital assets and the Digital Real (Drex) project, covering regulatory scope, VASP requirements, and CBDC development.
2025
Source: Central Bank of Brazil (BCB)

What Does the Central Bank's FAQ Cover?

The Central Bank of Brazil provides official guidance on its role as crypto asset regulator and the development of the Digital Real (branded "Drex"). This FAQ represents authoritative guidance for market participants operating in or entering the Brazilian market.

The FAQ addresses common questions about regulatory scope, licensing requirements, and the relationship between private crypto assets and the forthcoming central bank digital currency.

What Is the BCB's Regulatory Scope?

Covered Activities

  • Virtual asset exchange services (crypto-to-fiat, crypto-to-crypto)
  • Custody and safekeeping of virtual assets
  • Brokerage and intermediation services
  • Payment services involving virtual assets

Excluded from BCB Scope

  • Tokenized securities (CVM jurisdiction)
  • NFTs with unique characteristics (case-by-case assessment)
  • Pure technology providers without custody or exchange
  • Individual peer-to-peer transactions below thresholds

Coordination with Other Regulators

  • CVM for securities-like tokens
  • COAF for AML/CFT matters
  • Consumer protection agencies
  • Federal Police for criminal matters

What Are the VASP Licensing Requirements?

Authorization Process

  • Application to BCB with required documentation
  • Fit and proper assessment of management
  • Capital adequacy verification
  • Operational capability review
  • Compliance program evaluation

Operational Requirements

  • Segregation of customer assets from operational funds
  • Cybersecurity and operational resilience standards
  • Customer service and complaint handling
  • Record-keeping and audit trail maintenance

Ongoing Obligations

  • Regular reporting to BCB
  • External audit requirements
  • Incident notification procedures
  • Material change reporting

What Is Drex (Digital Real)?

The Central Bank provides guidance on its CBDC project:

Project Overview

  • Drex is Brazil's central bank digital currency project
  • Focus on wholesale and financial market applications
  • Built on distributed ledger technology
  • Designed for programmable and smart contract capabilities

Current Status

  • Pilot phase with selected financial institutions
  • Testing tokenized asset settlement use cases
  • Privacy and scalability solutions under development
  • Retail applications being evaluated for future phases

Relationship to Private Crypto

  • Drex is separate from private virtual asset regulation
  • Potential interoperability with regulated VASPs
  • Complementary roles in payment ecosystem
  • BCB maintaining technology-neutral stance

How Does Brazil Treat Stablecoins?

Regulatory Classification

  • Stablecoins generally fall under virtual asset framework
  • Functional assessment determines specific treatment
  • Payment-focused stablecoins may face additional requirements
  • Securities-like stablecoins subject to CVM rules

BCB Considerations

  • Financial stability implications monitored
  • Consumer protection focus for retail users
  • Reserve backing and transparency expectations
  • Cross-border stablecoin activity tracked

Future Developments

  • Potential specific stablecoin regulations under consideration
  • International coordination on stablecoin standards
  • Integration with Drex ecosystem possible
  • Reserve and redemption requirements may evolve

What Should Financial Institutions Consider?

Engagement with BCB

  • Proactive regulatory engagement recommended
  • Participation in consultations and pilot programs
  • Clear documentation of compliance approach
  • Regular communication with supervisory team

Strategic Planning

  • Monitor Drex development for integration opportunities
  • Assess stablecoin strategy in light of regulatory evolution
  • Build relationships with licensed VASPs for partnerships
  • Prepare for potential additional requirements

The Coinbax Perspective

The Central Bank's FAQ provides authoritative clarity that market participants need. Notably, the BCB takes a functional approach—focusing on what activities are performed rather than applying rigid categorical definitions.

The Drex project represents an important strategic development. Brazil is building public digital currency infrastructure alongside private crypto regulation, creating a dual-track system. Financial institutions should understand how these tracks may converge.

For institutions considering Brazil, the BCB's role as regulator is significant. The central bank brings monetary policy expertise and banking-sector experience to crypto oversight—a different dynamic than jurisdictions with novel crypto regulators.

Frequently Asked Questions

Is the BCB the only crypto regulator in Brazil?

No. The BCB regulates virtual asset service providers, but the Securities Commission (CVM) regulates tokenized securities. Activities may require coordination with both regulators depending on the specific assets and services involved.

When will Drex be available to the public?

Drex is currently in pilot phase focusing on wholesale applications. The BCB has not announced a specific timeline for retail availability, indicating that decisions will be based on pilot results and further development.

Do foreign stablecoins require BCB authorization?

VASPs offering services involving foreign stablecoins to Brazilian customers must be authorized by the BCB. The stablecoins themselves are assessed based on their characteristics and use in Brazil.

How does AML compliance work for crypto in Brazil?

VASPs must comply with Brazilian AML/CFT requirements, including customer identification, transaction monitoring, and suspicious activity reporting to COAF (Brazil's financial intelligence unit).