Brazil has become an emerging frontier for cryptocurrency trading, with Tether at the forefront. USDT adoption has skyrocketed, accounting for 80% of all cryptocurrency transactions in the country.

USDT’s Rapid Rise in Brazil

In mid-October, Brazil's USDT trading volume soared to 271 billion Brazilian reals (about $55 billion) this year. This figure is significantly higher than Bitcoin transactions. The total value is 151 billion reais (about $30 billion). The appeal of stablecoins such as USDT lies in their stable valuations, which are usually pegged to the value of traditional fiat currencies such as the US dollar and Brazilian real.

USDT trading traction began to gain momentum in Brazil as early as 2021. However, it wasn’t until July 2022, at the peak of the cryptocurrency industry’s turmoil, that USDT trading volumes surpassed Bitcoin trading volumes. This shift coincided with the fall of crypto lenders such as Three Arrows Capital and Voyager Capital, marking a critical moment in Brazil’s cryptocurrency landscape.

The turbulent cryptocurrency winter of 2022 caused a 25% drop in overall cryptocurrency trading volume in Brazil. According to government records, this figure decreased to 154.4 billion reais, or about $31 billion.

Brazil’s tax authorities have adopted a sophisticated mechanism to monitor citizens’ crypto activities. The system uses the power of artificial intelligence and network analysis to expertly identify suspicious behavior and track the whereabouts of cryptocurrency traders.

Legislative progress

On the legislative front, a major move occurred on October 25. The Brazilian local parliament approved a bill recognizing cryptocurrencies as "financial assets" involving overseas investments. From January 2024, income between 6,000 and 50,000 reais will be taxed at a 15% rate, while income above this limit will face a 22.5% rate.

After 2019, a directive required all cryptocurrency exchanges operating in Brazil to report user transactions to the government. There is a progressive tax structure for capital gains from cryptocurrency sales exceeding R$35,000 per month. Tax rates range from 15% to 22.50%.

USDT’s dominance in Brazil is a testament to the changing preferences of cryptocurrency enthusiasts. Stablecoins provide a semblance of stability in an otherwise volatile cryptocurrency space. It’s no wonder that USDT has become the preferred choice for many in Brazil. #巴西  #稳定币