Brazil Embraces Crypto Even When Its Government Doesn’t

Welcome to Latam Insights Encore, a deep dive into Latin America’s most related financial and crypto information from the previous week. On this version, we discover the astonishing progress of crypto in Brazil and the way its adoption is outpacing the federal government.

Latam Insights Encore: Brazilian Crypto Adoption Leaves the Authorities Behind

Brazil, one of many largest economies in Latin America, has proven that there’s a giant hole between the bottom-up adoption of crypto and the top-down strategy to industrial regulation.

The newest report from Chainalysis, a number one blockchain insights firm, exhibits that Brazil has skilled exponential progress in its crypto transaction volumes, turning into Latam’s de facto crypto hub. Based on the corporate, the Brazilian financial system traded $318.8 billion price of cryptocurrency belongings between July 2024 and June 2025, marking a milestone for the nation’s digital asset financial system.

And it not solely surpassed earlier figures, but additionally greater than doubled the earlier determine, signaling robust motion into these belongings by each establishments and personal customers.

These figures, which have left behind different main crypto economies within the area reminiscent of Argentina and Mexico, come after Brazilian authorities took unpopular measures towards crypto customers.

The newest considerations an interim measure by President Lula that ended tax exemptions for cryptocurrencies and instituted a flat tax price on crypto holdings, together with self-held belongings.

I’ve already hinted on the attainable end result of those measures, anticipating an exodus to unregulated platforms and decentralized protocols to bypass these authorities efforts.

What’s extra related, nevertheless, is that the present state of affairs exhibits a division between the atypical Brazilian, who desires to make use of crypto, and the Brazilian authorities, who’re as an alternative placing up limitations to discourage this.

The Brazilian authorities ought to take this under consideration and alter its varieties to turn into extra versatile with a expertise that has already taken root on Brazilian soil. If it would not do that, it dangers making its guidelines and rules irrelevant given the character of crypto.