CVM Calls on Bitcoin Market to Explain ‘Fixed Income’ Cryptocurrencies

The Securities and Exchange Commission (CVM) has subpoenaed broker Mercado Bitcoin to clarify its financial products launched in the form of tokens.

The asset tokenization movement has taken over the financial market in recent years and several institutions are entering this market.

For example, Itaú launched a Digital Assets team to symbolize financial products for its customer base. Other banks follow.

Cryptocurrency brokers have been doing this for a while as they have more experience with cryptocurrencies and blockchain technology.

CVM Calls On Mercado Bitcoin To Explain More About Its Fixed Income Products

The CVM is the federal agency in Brazil whose mission is to monitor and regulate the market for investment and financial products. When an abnormal situation is discovered, the committee must intervene to ensure that no problem gets out of hand.

So, according to information released by Estadão, the CVM has sued the Mercado Bitcoin brokerage, one of the largest in the country. The reason for the move is to better understand how the fixed income products that the brokerage offers to its clients work.

In its publications, MB offers these products as fixed income products to investors from R$100.00, made in stable assets and which can provide a superior return on savings in the short term.

The tokens come from consortia, energy, precatory and receivables, which are sold to their investors.

For the CVM, the Bitcoin market will have to inform the relationship of investors since 2020, how much they have invested in the products and whether the brokerage firm intends to maintain their offering. If the company keeps this offer available, it could face safeguards from the autarchy.

What is the Bitcoin market saying?

searched by live coinsMercado Bitcoin, which recently changed its brand to MB, said it does not offer any products beyond the authorizations it already has.

MB is a Brazilian startup that has been investing in the development of the local market under Brazilian law since its inception in 2013, and has spoken out in favor of regulating digital asset service providers, through the approval of PL 4.401/21. It also actively participates in the Innovation Laboratory of the CVM and the LIFT of the Central Bank, thus contributing to the creation of regulations for the sector.

In this sense, we do not conduct any public offering of securities beyond the scope of the authorizations we have as an authorized crowdfunding and investment manager platform.

With regard to the so-called non-security tokens (tokens that do not represent securities), we ensure that we do not infringe on the scope of the authorized entities, including consulting the regulator in advance about the structure used for such tokens, at the start of our activities in 2020.

Source: Live Coins