Proof of Reserves Is Not Enough: Brazil Demands Crypto Security Proof
- Brazil wants PSAVs to file independent security and AML reports by October 30, going beyond proof of reserves.
- PoR fails to prove ongoing controls, so Brazil mandates segregation, cyber tests and third-party audits.
- Licensed firms strengthen fund protections, but residual risks and point-in-time limits remain for users.
Brazilโs Central Bank (BCB) has established a strict regulatory regime for Virtual Asset Service Providers (VASPs/SPSAVs), requiring security checks, asset segregation and daily tracking alongside Proof of Reserves (PoR). However, PoR alone cannot guarantee customer protection, as it only shows that a platform holds certain assets at a specific point in time and does not address risks.
Security Standards Brazilian PSAVs Must Meet
Brazilโs crypto market is entering a new era. Under Law 14.478/2022, Decree 11.563/2023 and BCB Resolutions 519, โฆ
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