Brazil Orders Reporting of $10K Self-Custody Crypto Wallet Trades

The Central Bank of Brazil has introduced two new resolutions aimed at tightening anti‑money‑laundering (AML) and terrorism‑financing (TF) oversight of digital‑asset transactions that involve self‑custody wallets.

Resolution 588: Reporting Threshold for Self‑Custody Transfers

Resolution 588 mandates that any virtual‑asset service provider (VASP) authorized by the central bank must report transfers to or from self‑custodial wallets when the transaction value equals or exceeds US$10,000. The data will be forwarded to the Council for Financial Activities Control (COAF), which may use it to build a database of self‑custody addresses and map holdings of Brazilian users on authorized centralized exchanges.

Resolution 589: Ban on Unauthorized Service Providers

Resolution 589 creates a strict information‑sharing framework and prohibits operations that involve counterparties providing virtual‑asset services without authorization from the central bank. This effectively closes the regulated Brazilian crypto market to unlicensed participants.

Implementation and Market Impact

The rules take effect on October 1 2026, coinciding with the deadline for VASPs to obtain a license. The heightened compliance and capital requirements have already led to market consolidation, with only five VASPs having applied for a license so far.