© Reuters CVM regulates exposure to crypto assets in investment funds: understanding what changes
The Securities and Exchange Commission (CVM) has created a new regulatory framework for investment funds in Brazil that sets rules for exposure to crypto assets such as.
Under the self-system, regulated investment funds can maintain up to 10% equity exposure in digital assets. Revealed by Monetary Arbitration Commission Decision No. 175, this rule represents an update on the regulation of NIFs.
With the new decision, 38 standards by CVM have been canceled. In addition to setting a 10% limit on exposure to crypto assets, the document creates rules for financial investment funds (FIF) and receivable investment funds (FIDC).
Investing in crypto assets
In its quest to update the regulations for investment funds in Brazil, CVM has issued a new resolution to provide more security for investors.
According to João Pedro Nascimento, President of CVM, Decision 175 represents an update of the rules regarding investment funds in Brazil.
“The new rule for investment funds demonstrates the importance of a strong and practical regulatory environment for this very important industry in the Brazilian capital market. We follow an innovative methodology in which we adopt general standards applicable to all investment funds, which are complemented by specific rules contained in each of the appendices, which regulate the different categories for existing investment funds.
Crypto assets are classified as financial assets under Resolution 175, provided they are traded by firms previously authorized by the Central Bank and/or CVM.
With the municipality’s new regulatory framework, a 10% limit has been put in place for exposure to crypto assets in NIFs. Prior to the publication of the rule, this investment was made indirectly and through funds with assets earmarked abroad. In addition to Resolution 175, CVM and the Central Bank have already introduced initiatives regarding the regulation of crypto assets in Brazil, which the President of the Republic imposed at the end of 2022.
By Crypto Panorama