Crypto exchange Binance has finally put an end to its Brazilian regulatory nightmare. The company coughed up $1.76 million (or 9.6 million reais if you prefer) to settle with the Comissão de Valores Mobiliários (CVM).
Why? Because according to the CVM, Binance got caught playing fast and loose with unlicensed derivatives trading in Brazil after a relentless probe into its “sketchy trading practices” in the country.
Let’s back up a bit. Binance initially tried to get out of this mess by tossing a measly $370,000 (2 million reais) on the table back in August 2023. The CVM looked at that offer and said they weren’t interested in lowball settlements.
Fast forward a year, and Binance had to dig a lot deeper into its pockets.
Brazil’s crypto scene: High inflation and digital dreams
Brazil’s economic woes—high inflation, a tanking currency, you name it—pushed people towards alternatives like crypto. The Brazilian real has been on a losing streak for over a decade.
So, what do people do when their money keeps losing value? They look for something better. For many Brazilians, that “something better” turned out to be cryptocurrencies.
By 2021, about 8% of Brazil’s population was knee-deep in crypto, making the country the 14th highest in global crypto adoption. That’s no small number.
The Brazilian government didn’t just sit back and watch either. They rolled out the Pix system in 2020, a real-time payment platform that got people used to digital finance.
This tech-savvy move helped make crypto even more appealing to a population already hungry for financial alternatives.
But Brazil’s crypto boom wasn’t just about desperation. The rise in digital literacy played a big role too.
As more Brazilians got online and got comfortable with digital payments, crypto started looking less like a risky bet and more like a smart investment.
Cryptocurrencies are treated as assets under Brazilian law, which means they’re subject to all the taxes and regulations that come with that label.
The government has been working overtime to create rules that protect consumers without stifling the innovation that comes with the blockchain.
Despite all the red tape, Brazilian crypto exchanges have thrived. Take Mercado Bitcoin, for example. By 2021, it had over 5 million users, making it one of the biggest exchanges in Latin America.
All over Latin America, people in economically unstable countries have been turning to crypto as a way to protect their finances.
