Brazil Blocks Stablecoin Settlement for Key International Payments

Brazil's central bank has announced that it will block stablecoins from settling one specific type of international payment flow starting October 1. The new rule, Resolution 561, targets the settlement leg between regulated foreign-exchange providers and their overseas counterparties.

This means that eFX providers can no longer use stablecoins or other virtual assets to settle with their foreign counterparts. However, individual international transfers using virtual assets remain permitted under Brazil's existing framework.

Oscar Guillermo Farah Osorio, founding partner at Zanella & Farah, described the move as resolving genuine ambiguity left by Brazil's 2022 virtual assets law. The law had given the central bank authority to decide which crypto operations count as foreign-exchange activity, but specific rules never followed.

The resolution affects the eFX model, which lets providers bundle many individual payments together and net balances across an entire day before settling once with their foreign counterparties. This structure suits high-volume, low-value flows well, such as streaming subscriptions and online gaming payments.