Central Bank may criminalize operations with stablecoins for P2P and DeFi
Building - headquarters of the Central Bank of Brazil in the North Banking Sector. Photo: Marcello Casal JrAgência Brasil.
The Central Bank’s recent proposals to amend Resolution No. 277/2022 may have further implications for the stablecoin market — cryptocurrencies pegged to the dollar, such as USDT and USDC — in Brazil.
Among the main impacts is the possibility of criminalizing operations carried out in decentralized environments, such as DeFi protocols (decentralized finance), OTC (over-the-counter) markets and P2P (peer-to-peer) transactions.
In Brazil, through the amendment of Resolution No. 277, the Central Bank of Brazil intends to consider operations with stablecoins as exchange transactions, which means, as a rule, criminalizing decentralized operations involving stablecoins, contradicting one of the fundamental principles of operation of the cryptoasset market.
In effect, if the Central Bank's understanding prevails, currently subject to public consultation, in the same way as in relation to exchange transactions, by force of article 3 of Law 14,286/2021, transactions involving stablecoins may only be carried out through institutions authorized to operate in the exchange market.
In other words, carrying out operations in decentralized environments, such as DeFi protocols (decentralized finance), OTC (over-the-counter) markets and P2P (peer-to-peer) transactions, are now criminalized, as will be seen in depth in the topic below.
Criminalization through Heterogeneous Blank Penal Norms
Brazilian criminal law provides for the criminalization of unauthorized exchange transactions, in accordance with article 22 of Law No. 7,492/1986, which establishes:
“Carrying out an unauthorized exchange transaction, with the purpose of promoting the evasion of foreign currency from the country: Penalty – imprisonment of 2 to 6 years and a fine.”
In turn, the concept of “unauthorized exchange transaction” depends on complementary regulations, such as those issued by the Central Bank. These regulations are called heterogeneous blank criminal rules, as Claus Roxin explains:
“Heterogeneous blank criminal norms are those whose defining elements of the criminal type do not come from criminal law itself, but from norms from other areas, such as administrative or technical regulations.” (ROXIN, Claus. Criminal Law – General Part, 5th ed.)”
Thus, changes proposed by the Central Bank may expand the scope of article 22, including operations with stablecoins carried out outside the environment of authorized institutions, such as unauthorized exchange operations, subjecting offenders to a prison sentence of 2 to 6 years and a fine.
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