Brazil Pretrial Seized Bitcoin Sales, New Crypto Rules
Brazil’s Congress is reviewing Bill 5.582/2025 to authorize the pretrial sale of seized Bitcoin, treating digital assets like foreign currency or securities. Under the anti-faction law, banks and exchanges can liquidate seized Bitcoin before court verdicts, although protocols for acquitted individuals remain undefined. The measure targets gangs such as Comando Vermelho and faces a December 18 vote. Simultaneously, the Central Bank of Brazil will enforce stricter crypto regulation from February: all crypto firms must obtain a license, hold capital reserves of 10.8 to 37.2 million reais, and report transactions under new FX and capital market rules. This dual push for seized Bitcoin sales and crypto licensing reflects a tougher compliance landscape for traders and institutions.
Bearish
Authorizing pretrial sales of seized Bitcoin introduces additional supply to the market, likely driving short-term selling pressure on BTC prices. At the same time, tougher crypto licensing and capital reserve requirements raise compliance costs for exchanges and custodians, potentially reducing market liquidity. While clearer regulations can benefit institutional adoption in the long term, the immediate effect on Bitcoin is expected to be negative due to increased sell-off risk and operational burdens for service providers.