Brazil Brings Self-Custody Crypto Transfers Under Anti-Money Laundering Rules
Brazil's central bank has implemented a new rule requiring institutions to report transfers worth $10,000 or more between covered entities and self-custody wallets. This change aims to increase monitoring of transactions involving self-custody wallets, which are controlled directly by users.
The reporting threshold is the same as for foreign-exchange transactions involving physical delivery or receipt of foreign currency. The rule applies to both incoming and outgoing transfers from self-custody wallets, regardless of direction.
Resolution BCB No. 588 amends Circular No. 3,978, the Banco Central do Brasil framework covering anti-money laundering and counter-terrorist financing procedures for supervised institutions. The new reporting requirements take effect on October 1, 2026, alongside a broader tightening of Brazil's virtual-asset framework.
The distinction between self-custody wallets and institutional custody is crucial to understanding the regulation. Self-custody wallets remain private infrastructure, while the bridge connecting them to supervised financial infrastructure becomes regulated infrastructure.