Brazil’s adoption rate of USDT soars, accounting for 80% of the total cryptocurrency market.

Brazil's USDT Adoption Rate Skyrockets to 80% of Total Cryptocurrency Market

Author: Ana LianGuaiula Pereira, Cointelegraph; Translation: Song Xue, LianGuai

As of mid-October, this year’s USDT trading volume in Brazil reached 271 billion Brazilian Real (approximately 55 billion US dollars), nearly double the trading volume of Bitcoin.

Since 2021, the trading volume of USDT in Brazil has been growing, but in July 2022, it surpassed Bitcoin trading volume for the first time, coinciding with the peak of last year’s cryptocurrency industry storm, when cryptocurrency lending institutions Three Arrows Capital and Voyager Capital collapsed.

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The top six cryptocurrencies by trading volume in Brazilian Real. Data source: Receita Federal

According to government reports, the bear market in cryptocurrencies reduced the country’s cryptocurrency trading volume by nearly 25% in 2022, reaching a final total of 154.4 billion Real, approximately 31 billion US dollars.

The Brazilian tax authority uses a complex system relying on artificial intelligence and network analysis to track citizens’ activities related to cryptocurrencies. According to a blog article, the system is capable of detecting suspicious activities and tracing the locations of individuals transacting with cryptocurrencies.

The tax agency is also targeting cryptocurrency investments held by Brazilian citizens overseas. On October 25th, the local Congress passed legislation that treats cryptocurrencies as “financial assets” of foreign investments. Starting from January 2024, individuals with overseas income between 6,000 and 50,000 Real (approximately 10,000 US dollars) will be subject to a tax rate of 15%. Above this threshold, the tax rate is 22.5%.

Since 2019, cryptocurrency exchanges operating in Brazil are required to disclose all user transactions to the government. Capital gains from cryptocurrency sales exceeding 35,000 Real (approximately 7,000 US dollars) per month are subject to progressive taxes ranging from 15% to 22.50%.

Global cryptocurrency exchanges such as Coinbase, Binance, Bitso, and Crypto.com operate in the country alongside local participants like Mercado Bitcoin and Foxbit.

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