“Today’s announcement of co‑ordinated international action on cryptoassets is a major step forward, marking another important milestone towards the widespread and co-ordinated approach to combat tax evasion through greater transparency and exchange of information,” Secretary-General Cormann said.

“We strongly welcome the extensive support being shown for quick action to make the international exchange of information collected under the OECD standard on cryptoasset reporting a reality. The international community can count on the OECD and the Global Forum on Transparency and Exchange of Information for Tax Purposes to ensure that the tax transparency architecture remains both up-to-date and effective going forward.”

The Crypto-Asset Reporting Framework (CARF) is a key component of the International Standards for Automatic Exchange of Information in Tax Matters developed by the OECD under a G20 mandate. It provides for the automatic exchange of tax-relevant information on cryptoassets and comes against the backdrop of a rapid adoption of the use of cryptoassets for a wide range of investment and financial uses.

The decree, which comes into force on 20 June 2023, says: "The Central Bank of Brazil will discipline the operation of virtual asset service providers and will be responsible for supervising said providers."

The decree makes clear that "assets respresenting securities" will be overseen by country's securities regulator, the Comissão de Valores Mobiliários (CVM).

The CVM issued a note regarding the decree, making it clear that tokens which are considered securities "must comply with CVM regulations, especially when raising funds from investors (public offering of distribution)."

The decree does not affect the jurisdiction of  the National Consumer Protection System, or the CVM’s authority over financial crime prevention.

The new law, which comes into effect in June 2023, creates a crime of fraud using virtual assets, securities or financial assets. The penalty is  4 to 8 years imprisonment plus a fine.

The law also creates a licensing regime for virtual asset service providers, including exchanges and trading intermediaries.

The Ministry of Economy, the Central Bank of Brazil, the Securities Commission and the Superintendent of Private Insurance (Mobiliários e a Superintendência de Seguros Privados) have come together to create a regulatory sandbox in the hope that this will promote the development of products and services that can foster innovation in the financial, security and capital markets sectors.

The authorities said that the move comes as a response to the changes currently taking place in the financial, capital and insurance sectors.

"The use of innovative technologies, such as distributed ledger technology, blockchain, roboadvisors and artificial intelligence, has allowed the emergence of new business models, reflecting the offer of products and services of higher quality and scope," the regulators said in a press release.

The emergence of these new business models challenges regulators to be flexible and to adapt regulations to technological changes, so that regulated activities remain compliant, irrespective of the way in which services and products are delivered.

The four regulators said they will co-ordinate their activities to monitor how the sandbox works in their respective spheres of competence, taking into account elements common to the models used in other jurisdictions, such as the granting of temporary authorisations and exemptions from for specific regulated activities.

In addition, the regulators said that they will seek to act as one whenever the activities go through more than one regulated market.

The Secretary of the Treasury has also released a paper on FinTech and sandboxes.