IMF Says Brazil’s Crypto Cross-Border Flows Have Overtaken Traditional Capital Transfers
Forecast Trend Report by Period
Crypto-based cross-border money flows in Brazil have surpassed traditional capital transfers, driven by the rapid adoption of stablecoins by companies and individuals for moving funds overseas.
Odaily reported on July 28 that the International Monetary Fund, in a financial system stability assessment for Brazil released this month, said the country’s crypto-based cross-border flows have risen steadily since 2017.
The IMF said most of those flows came from stablecoins, which companies and individual investors use for transaction efficiency and tax-related reasons.
The report found that stablecoin flows are influenced not only by the S&P 500 Index, the Cboe Volatility Index and Bitcoin prices, but also by exchange rates, interest rates, policy uncertainty and tax changes.
The IMF also said Brazil’s central bank has begun regulating virtual asset service providers, or VASPs, but protections for customers and the segregation of custodial assets remain inadequate. It said Brazil also needs to fully implement international standards in its anti-money laundering and counter-terrorism financing framework, including the Travel Rule requiring the sharing of information on transaction parties.
