Brazil Bars Bybit From Securities Brokerage

Singaporean digital asset exchange firm, Bybit, has been asked to shut down its operations involving the sales of securities as a middleman in Brazil by the Securities and Exchange Commission. The CVM made this announcement on Monday in its declaratory act after indicting the company. This ban extends to the use of social media and online platforms, among others, to sell securities. 

The Reason Behind The Ban

After assuming its position as one of the largest digital asset dealers in Asia and Europe and interacting with six million customers on average, with a trading volume of $10 billion, the firm decided it was the right time to penetrate Brazil with its hefty amount of liquidity.

Bybit got caught trading securities without legal authorization to do so. It was attempting to pool funds from Brazilian investors without a license when it got apprehended by the authorities. Unfortunately, B3 securities firm is the confirmed stock exchange company legalized to trade stocks in the country. 

The SEC of Brazil honked a final warning horn for Bybit to desist from securities brokerage within its jurisdictions unless it would face the penalty of paying a day-to-day levy of five thousand Brazilian reals, an equivalent of $194.

Earlier in April, the company had launched a marketplace for non-fungible tokens and a platform for its products in Brazil while allowing the use of Brazilian reals for buying crypto. Following its successful set-up in April, the Exchange started seeking ways to ease-out Brazilians’ access to digital assets by studying the CVM debate on cryptocurrency regulations to avoid a similar turn of events as with Binance two years ago when it was closed. 

The Brazilian Chamber of deputies declared its intention to postpone deliberations on crypto regulations until the end of the imminent presidential election in October, even though it was supposed to review the Bill on cryptocurrency recently passed in the house. So far, the lawmakers are focused on writing guidelines for drafting the country’s budgets and adjusting medical constitutions.

Bybit’s Similar Scenario

Earlier in June, OSC, in an enforcement news release, declared Bybit in violation of crypto regulations in Canada, causing the company to get fined along with Kucoin. Bybit was required to pay $1.9 million even after cooperating with the authorities of Ontario for acting against the established standard of crypto operation in the country.

Furthermore, the company got restricted from taking in more customers from the citizens of Ontario. After the financial markets crashed in June, Bybit had to lay off some of its staff to hold its finance together. 

Three months ago, Bybit announced a decision to increase its reach to Argentina with the mind of offering crypto services to Argentinians. Part of the company’s agenda was to provide investment schemes to citizens and a 22% APY on Dai deposits for investors. 

In other news, Esport team MIBR has entered a three-year sponsorship contract with Bybit.