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Brazil’s stablecoin debate is becoming a question about money itself.
When used for payments, the Central Bank of Brazil wants to treat certain stablecoins more like the country’s electronic money framework, according to commentary from analyst Marcel van Oost as well as recent Brazilian coverage of the debate.
At a Chamber hearing on PL 4308/2024, regulators and industry groups debated over the legal nature of stablecoins. The central bank wants authority over payment-like tokens, while industry groups want stablecoins treated as virtual assets.
The decided outcome would apply to USDT, USDC, and other fiat-backed tokens, which Brazilians use for transfers, dollar exposure, settlement, and remittances. If payment stablecoins are treated more like electronic money, exchanges, issuers, and wallet providers would have to abide by rules like those applied to regulated payment institutions.
Brazil’s PL 4308/2024 is built around stablecoins. The Chamber of Deputies lists its purpose as it “disciplines stablecoins” and the proposal is now awaiting a report in the Chamber’s Economic Development Committee after a June 17, 2026, public hearing request was approved.
The Chamber’s Science, Technology, and Innovation Committee approved a substitute in December 2025. The text would require each stablecoin to be fully backed by fiat currency or government bonds. It also requires reserve segregation, meaning backing assets cannot be used to pay an issuer’s debts.
Said proposal also bans purely algorithmic stablecoins. Instead, Brazil is focused on stablecoins that claim value through stable, identifiable reserves as opposed to those that use code or market mechanisms to hold a peg.
Foreign-issued stablecoins are the hardest asset to regulate.
Brazilian officials have already been concerned about dollar-backed stablecoins moving value internationally. Reuters reported in May 2025 that Brazil’s central bank estimated around 90% of the country’s cryptoasset flow was linked to stablecoins, with Deputy Governor Renato Gomes warning that they can be used to move reais into dollars with less oversight than in traditional pathways.
PL 4308 clarifies that stablecoins issued abroad could only be offered in Brazil through authorized virtual asset service providers (VASPs). Those firms would need to check whether the foreign issuer follows Brazilian law. If not, the local platform would be responsible for assessing risk.
The stablecoin industry in general isn’t necessarily fighting for less regulation, but rather separation from regular crypto. However, ABcripto, Brazil’s crypto economy association which includes platforms like Coinbase, prefers a different approach from the Chamber.
ABcripto argues stablecoins should not be treated as electronic money because they operate under a separate framework. Unlike e-money tied to payment accounts and issuer-controlled balances, stablecoins run on blockchains, move through digital wallets, and can transfer between users without direct issuer involvement.
The group supports reserves, audits, transparency, and asset segregation. However, it argues that Brazil can introduce those protections without placing stablecoins under electronic money rules. The country’s decision will determine whether or not stablecoins remain a blockchain-based payment method or operate under traditional electronic money rules.
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