The Central Bank of Brazil (BCB) formalized its recommendation to the National Congress to prohibit or impose severe restrictions on stablecoins issued by foreign companies, such as Tether, issuer of USDT, that do not have local supervision.
The proposal, detailed in a technical note sent on April 29, 2026, seeks to influence the final wording of Bill 4308/2024, which will establish the regulatory framework for digital assets in the largest economy in Latin America.
The document, signed by Fábio Araújo, responsible for the Real Digital project (the CBDC of the Central Bank of Brazil), maintains that the proliferation of stablecoins linked 1:1 to the US dollar represents a risk to monetary sovereignty and the national payment system.
In this sense, the monetary authority bases its position on three pillars, which are: the protection of the real, financial stability and equal conditions. According to the BCB, entities that issue stablecoins from abroad currently operate without meeting the capital and transparency standards required of local financial institutions.
“The use of assets that do not offer prudential guarantees compromises the effectiveness of monetary policy and the integrity of the payment system,” highlights the technical report.
For the user, this measure aims to close what the regulator describes as a “legal loophole.” While traditional bank deposits have institutional backing, Cryptocurrencies issued outside Brazilian jurisdiction do not offer protection mechanisms in the event of possible insolvency of the issuer.
What would happen if stablecoins are banned in Brazil?
If approved by legislators, the measure would force exchange platforms to limit or withdraw assets such as USDT and USD Coin (Circle) from their offer. The relevance of this decision is high, since USDT is the main gateway for Brazilians seeking to protect their assets against exchange rate volatility.
In practice, these currenciesThey function as a critical infrastructure for the trading of cryptoassets in the countryrepresenting most of the transactional volume in local brokers, even throughout Latin America, as recently noted in an opinion article published in CriptoNoticias.
The digital asset community is raising concerns about what they see as a restrictive approach. The industry’s central argument is that a ban would not stop the use of these assets, but rather would encourage the transfer of operations to unregulated offshore platforms, where the State would lose all control capacity, as has been happening in Venezuela.
Likewise, they warn that the lack of access to these liquidity channels could increase operating costs for local companies and reduce Brazil’s competitiveness in the global fintech ecosystem.
Brazil’s position is part of a global trend. Regulations such as MiCA in the European Union already require stablecoin issuers to maintain auditable reserves and legal presence in the territory. The debate is now under the responsibility of the National Congress, which will determine whether Brazil integrates these assets under an authorization regime or if you opt for a restriction of access to the internal market.
The crossroads facing the Brazilian Congress is fundamentally about the meaning of financial freedom in the 21st century. This is because while the Central Bank seeks to protect the foundations of the national economy, the citizen seeks tools to navigate an increasingly digitalized and global world.
In the end, the success of regulation will not be measured by the severity of the bans, but by the capacity of the State to offer an alternative that is as accessible as stablecoins have been for millions of Brazilians. The challenge is to find that middle ground where system protection does not become a barrier to progress.