Brazil bans stablecoins for specific cross-border settlements starting Oct. 1

New Brazil rule blocks stablecoin bulk settlements

Brazil's central bank will prohibit the use of stablecoins and other virtual assets to settle aggregated cross-border payments starting October 1. This rule, part of Resolution 561, targets the settlement process between regulated foreign-exchange providers and their overseas partners. It requires these large-volume transactions to move through licensed foreign-exchange systems or specific non-resident accounts instead of crypto rails.

The restriction does not ban stablecoins in Brazil. Individuals can still send personal international transfers using crypto assets under existing laws. However, the new rule removes a shortcut that allowed payment firms to bundle many small transactions together and settle them at once using digital dollars. This change aims to close a regulatory gap that previously allowed some market participants to operate outside the formal foreign-exchange system.

Key changes and what remains

• Bulk settlement blocked: Providers can no longer use stablecoins to settle netted balances with foreign counterparties for high-volume, low-value flows like e-commerce or gaming payments.
• Aggregation allowed: The practice of bundling payments together (netting) is still permitted, but the final settlement must use traditional banking channels or qualified accounts.
• Personal transfers safe: Regular users can still send individual international transfers using virtual assets.
• Cost implications: Experts warn that removing stablecoin settlement may increase costs for consumers and businesses. They may face higher fees from correspondent banks, SWIFT networks, and financial transaction taxes that crypto previously bypassed.

What Brazilian experts say

Oscar Guillermo Farah Osorio, a founding partner at the law firm Zanella & Farah, told CryptoSlate that the new resolution resolves genuine ambiguity in the law. Brazil's 2022 virtual assets law gave the central bank the power to define which crypto operations count as foreign-exchange activity, but specific rules had not been implemented until now. Farah noted that the new rule gives regulators clearer visibility into financial flows that were previously difficult to monitor within the formal exchange system.

Market context and statistics

The stablecoin market in Brazil is significant, with the tax authority recording R$1.13 trillion in declared stablecoin transactions between August 2019 and December 2025. Stablecoins made up roughly 72% of all declared crypto activity during that period. In 2025 alone, they accounted for nearly 80% of declared volume, with Tether (USDT) representing almost 89% of that stablecoin total.

A July study by the Bank of Italy analyzed USDC transfers across ten international corridors, including Brazil. It found that total costs for these transfers ranged from 0.3% to nearly 9%, with no consistent cost advantage over traditional payment channels. The study noted that while blockchain transfers themselves are cheap, the bulk of the expense comes from currency conversion and local payment infrastructure. Resolution 561 does not directly measure the impact on the specific volume of stablecoin settlements being banned, as public data does not isolate that specific channel.

Why this matters

This move highlights the regulatory hurdles facing financial firms trying to integrate stablecoins into cross-border payments. While stablecoins offer speed and potential cost savings for individual transfers, the new rules mean that large-scale business settlement will revert to more expensive traditional banking methods. For consumers, this could lead to higher prices for goods and services paid in foreign currencies, as businesses absorb the additional fees and taxes associated with conventional foreign-exchange transactions.

Sources

• CryptoSlate