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This week, Brazil's Senate approved a bill on cryptocurrencies during a plenary session, paving the way for official regulation of crypto in the world's ninth-largest economy.

The bill needs approval from the Chamber of Deputies before it can be signed into law by President Jair Bolsonaro. This likely will not occur until later this year.

First introduced in 2015, the bill allows Brazil's executive branch to create rules on virtual assets. The bill still needs to decide if Brazil's central bank, Securities and Exchange Commission, or a brand-new body will regulate the industry.

Observers point out that if the bill moves ahead, the Brazilian economy will be the largest in Latin America offering a regulatory framework for virtual assets. Although El Salvador made Bitcoin legal tender last year and Cuba regulates cryptocurrency as a payment method, the size of Brazil's population and economy will place it among the top countries adopting regulation for crypto.

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According to Chainalysis, Brazilians earned $2.56 billion from cryptocurrency in 2021.

The country is also embracing crypto mining by offering a tax exemption for importing ASIC mining rigs into Brazil.