Binance has applied for a cryptocurrency service provider license in Brazil ahead of an Oct. 30 regulatory deadline, as customers face product restrictions and a split between domestic services and access to offshore derivatives.
The exchange submitted its application to the Central Bank of Brazil on Oct. 23 through its local entity, BBrasil. Binance said the application would allow Brazilian customers to retain access to crypto services.
Existing providers must apply by Oct. 30 to continue under transitional arrangements. An application is not regulatory approval, so the filing does not mean Binance has received its license.
The authorization framework follows Brazil's Law 14,478, enacted in December 2022. Decree 11,563, issued in June 2023, designated the central bank as the regulator for virtual asset service providers, without displacing the securities regulator's authority over assets classified as securities.
Product restrictions take effect on Oct. 27
The immediate change for customers is a narrower product range. Binance's Oct. 8 FAQ sets Oct. 27 as the restriction date for services such as Loans and Margin. Launchpool and Alpha 2.0 are also among the affected products.
Existing margin positions have no stated closure deadline. However, customers will no longer be able to open new margin orders, transfer funds or borrow additional amounts after Oct. 27.
Loans will enter reduction-only mode, with repayment still available. Binance said the change itself would not trigger fees or penalties. Any balance left after repayment will return to the customer's Spot wallet.
The exchange also identified 22 tokens for local delisting, among them XVG and USDE. Its FAQ says customers can trade affected tokens until Oct. 27; afterward, balances will remain available for withdrawal or reinvestment.
"We support a regulated market that considers the characteristics of virtual assets, so that access to technology and innovation continues to advance, but we hope that the ongoing dialogue with the Central Bank will allow us to offer, in the near future, other products that were discontinued to comply with current regulations," said Thiago Sarandy, Binance's general manager in Brazil.
Local accounts will sit alongside separate futures access
By Oct. 29, Brazilian users are due to receive individual payment accounts at Binance Brasil Corretora de Câmbio e Valores Mobiliários, formerly Sim;paul. Account opening carries no charge.
BBrasil will provide the permitted virtual asset services. Binance says transaction histories will remain accessible and crypto deposit addresses will not change. Customers whose identity records need an update will receive a notice.
Futures have a separate arrangement. It cannot offer derivatives to Brazilian residents, but describes an international account through its Abu Dhabi entity for customers who access those products on their own initiative.
Customers who choose to migrate existing futures positions to that account can continue to trade under the applicable terms. Positions that do not migrate will become reduce-only in the Brazilian account.
Other restricted products will not migrate to the international account. Brazilian residents also cannot retain only an international Binance account.
Cross-border transfers face additional checks
From Nov. 1, international crypto transfers will require customers to state the transaction's purpose and confirm counterparty details, Binance said. Withdrawals will await completion of those checks, while incoming deposits will remain pending until customers supply the required information.
The company says it will report those transactions monthly to the central bank. Transfers between customers' local and international accounts will also be reported under Resolution BCB 521.
For domestic activity, Binance says its Brazilian entity will submit the legally required reports to the Federal Revenue Service. It also plans annual statements for users during the income tax declaration period.
The international entity will retain its existing transaction histories. Customers will remain responsible for their own records and any reports required for those offshore operations.
The Central Bank of Brazil did not immediately respond to a request for comment.
Roman Zaika
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