Bybit Exchange Stops Cryptocurrency Activities in Brazil

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The Brazilian Securities and Exchange Commission (CVM) has imposed a ban on the activities of the Bybit trading platform, accusing it of unlicensed distribution of securities.

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The regulator’s order states that the exchange is obliged to suspend all services and operations for the storage and trading of cryptocurrencies. The ban applies to the trading platform itself, its website, applications and information channels of the exchange in social networks and instant messengers. Since the ban, the site cannot directly or indirectly provide cryptocurrency services to Brazilian citizens. The watchdog accuses Bybit, which provided spot trading and derivatives trading services, of seeking investment as an intermediary without CVM’s proper securities clearance.

CVM has previously stated that derivative contracts are securities – regardless of the underlying assets. The regulator requires Bybit to immediately comply with the ban, otherwise the platform faces a daily fine of 1,000 Brazilian reais ($194). In Brazil, foreign issuers can only trade securities on local exchanges in accordance with CVM rules, and only the B3 Brazilian Stock Exchange can offer securities for purchase.

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In 2020, trading platform Binance faced a similar situation: it was ordered to stop trading crypto derivatives on its Brazilian platform. According to the regulator, Binance Futures attracted Brazilian users through the website, offering them its cryptocurrency derivatives trading services. However, Binance did not have the necessary permission to do so, so the exchange could not be an intermediary for securities transactions in Brazil. Binance will aim to re-enter the Brazilian market this year by acquiring Brazilian securities broker Sim;paul Investimentos, licensed by the Brazilian Central Bank and the Securities and Exchange Commission.

Source: Bits

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