Brazil’s central bank has introduced new crypto compliance rules that expand scrutiny of transfers involving self-custody wallets and tighten the perimeter for authorized service providers. The measures were adopted through Resolutions 588 and 589, issued on Wednesday as part of a broader update to anti-money laundering and counter-terrorism financing controls for the sector.

Under the new framework, institutions authorized by the Central Bank of Brazil will have to report transfers of virtual assets worth at least the equivalent of $10,000 when those transactions move to or from self-custody wallets. The rules also prohibit dealings with virtual asset service providers that are not authorized to operate in Brazil.

New reporting threshold for self-custody wallets

Resolution 588 applies to institutions already authorized to operate by the central bank. It requires those firms to report operations involving transfers of virtual assets to or from self-custodial wallets once the value reaches the equivalent of $10,000 or more.

The central bank said the measure is aimed at improving oversight of self-custody arrangements, where users control their own wallets instead of leaving assets with a virtual asset service provider. According to the authority, that structure can limit the information available for monitoring and risk assessment compared with assets held in custody by a central-bank-authorized institution.

AML data to be sent to COAF

The reported information is set to be submitted to the Council for Financial Activities Control, or COAF, Brazil’s money laundering watchdog. The source article says the agency could use the disclosures to organize these transactions and potentially build a database tied to self-custody addresses.

If that happens, the result could be a clearer map of holdings linked to Brazilian users who move assets through authorized centralized exchanges. The source article presents that outcome as a possible consequence of the reporting flow, rather than a confirmed new system already in place.

Unauthorized providers shut out of the regulated system

Resolution 589 adds a separate restriction focused on who regulated firms can transact with. It creates a ban on operations whose counterparties are institutions or entities providing virtual asset services without authorization to operate in Brazil.

Taken together, the two resolutions both increase reporting duties and narrow access to the regulated market. In practice, the central bank is pairing closer transaction visibility with a stricter rule that limits participation to licensed or otherwise authorized firms.

Start date aligns with licensing deadline

The new rules take effect on Oct. 1, 2026. That date matches the deadline for virtual asset service providers to obtain authorization to operate in Brazil.

The source article says rising compliance obligations and capital requirements are already affecting the market. It reports that only five VASPs have applied for a license so far, a figure cited as a sign that Brazil’s crypto industry may be heading toward significant consolidation as the deadline approaches.

Source: news.bitcoin.com