Brazil sets clearer rules for banks entering crypto

The Central Bank of Brazil (BCB) set new regulations for banks and brokers handling crypto assets in South American country.

The new crypto rulebook specifies what banks and securities firms must submit and what an external certifier must confirm before offering crypto intermediation and custody services in Brazil.

Instrução Normativa (IN) BCB No. 701 was published in Brazil’s official gazette on January 23, 2026, and will become effective on February 2, 2026.

Brazil’s central bank formalizes crypto entry rules

IN 701 does not build Brazil’s crypto framework from the ground up. It applies sections of BCB Resolution No. 520 (Nov. 10, 2025) by defining the communication steps and the essential content needed.

Under IN 701, banks must maintain current registration in Unicad. Also, they must submit independent certification via the BCB’s APS-Siscom system.

If the bank does not complete all required steps, the communication is ineffective at the BCB. The bank stays barred from providing crypto services under the new rules.

Banks must hire an independent, qualified certifier to verify their compliance with the BCB rules for VASPs before starting operations.

The certifier must sign a declaration with the applicant bank, confirming no corporate or commercial ties that might cause a conflict of interest.

User funds must be separated

Certifiers must verify that institutions keep user funds separate from company assets and show evidence of reserves for all digital assets held by both customers and the company.

IN 701 requires the certification to clearly evaluate each item to determine if the institution meets baseline requirements.

The certification must include operational controls common in prudential frameworks. These controls involve outsourced services, especially data processing and cloud computing. 

It must also assess the technical and legal compliance of key suppliers, including those abroad. 

Recovery plans for client assets and funds are required. Governance policies, internal controls, and cybersecurity with incident response measures must also be addressed.

The certifier must examine controls related to anti-financial-crime compliance, including anti-money laundering, counter-terrorist financing, and proliferation-financing risks. 

They must also review market integrity procedures aimed at detecting and stopping abusive actions in the virtual-asset market.

The certification should cover each required item individually.

The BCB may ask the certifier for more detailed explanations if needed.

IN 701 requires certifiers to verify that banks clearly inform customers about the services, support channels, key third-party providers, guarantee funds or insurance, custody processes, risks of the virtual asset and its blockchain, and the terms and risks of staking operations.

The rule now mandates certifiers to retain working papers and memos for five years, enhancing the BCB’s review capability.

Brazilian banks gain a faster path into crypto

Isac Costa, professor and director of the Brazilian Institute of Technology and Innovation (IBIT), says banks may function without fully completing the usual authorization process for common VASPs if they secure certification.

He told Valor Econômico that institutions may begin services 90 days after notifying the Central Bank, provided they have independent technical certification confirming full regulatory compliance.

The rules do not name the companies that will certify institutions, but Costa thinks auditors familiar with crypto will take on this role.

The central bank is likely to clarify this issue because these auditors play a key role in bringing banks into the crypto industry.

This is important for Brazil’s effort to promote crypto through banks.

Banks and brokerages in Brazil are interested in providing crypto trading and custody to retail investors. 

The BCB’s method shifts some initial verification tasks to an external certifier but retains the supervisor’s authority to review, block, or stop actions.

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