Brazil has forbidden electronic foreign exchange (eFX) companies from using cryptocurrencies to settle overseas remittances.
That’s according to a new resolution from the country’s central bank, published last week and flagged Sunday (May 3) in a report by CoinDesk.
Under the new rules, set to go into effect Oct. 1, payments between a Brazilian eFX company and its overseas counterpart needs to move via a foreign exchange transaction or a nonresident real-denominated account in Brazil, with cryptocurrencies not allowed.
In addition, remittance companies are forbidden from taking Brazilian reais from a client, converting those funds into stablecoins or bitcoin, and settlement payment on a blockchain, the new rules say.
The CoinDesk report noted that the rule does not ban crypto trading, but seems to target companies such as Wise, Nomad and Braza Bank which had embedded stablecoin settlement into cross-border flows.
The report also cites data from Brazil’s federal revenue service showing that the country’s crypto market is moving $6 billion to $8 billion per month, 90% of that volume coming from stablecoins. Brazil placed fifth in worldwide crypto adoption last year, CoinDesk added, up from tenth in 2024. Roughly 25 million Brazilians hold or transact in crypto, the report said.
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Meanwhile, PYMNTS wrote in March about the mismatch between stablecoin’s reputation as a source of innovation/disruption in the cross-border payments world, and their actual use in carrying out those transactions.
As that report said, stablecoins account for an “infinitesimally small” percentage of cross-border payment volume. Payments coming from Latin America and Africa, two regions considered hot spots for digital assets, each add up to less than $1 billion.
Most modern stablecoin payment activity comes almost exclusively from three places, according to data from McKinsey: Hong Kong, Japan and Singapore.
“Beneath the headline crypto noise, however, a more powerful, real-world transformation has been unfolding,” that report said. “Traditional payment rails, long criticized for being slow, opaque and expensive, are undergoing a structural upgrade.”
Three main advances are fueling this change: real-time rails are expanding around the world, foreign exchange costs are declining and “APIs are turning payments into software and streamlining local and multicurrency collections,” the report added.
Many of the advantages associated with stablecoins, like speed, lower costs and flexibility, are now being delivered by the existing financial system, PYMNTS said.
“In other words, the transformation of cross-border payments is not waiting for a new system to replace the old one. It is happening within the system itself.”
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