Crypto Tax Loophole Set to Close in Brazil, Impacting Billions in Transfers

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Millions of Brazilians using cryptocurrencies for cheaper international payments are facing a new tax.

The government is set to expand its existing financial transaction tax (IOF) to cover cross-border crypto transfers, a move that would tap into a market that surged to 227 billion reais ($42.8 billion) in the first half of 2025.

With two-thirds of that volume coming from the dollar-pegged stablecoin USDT, authorities are now classifying such assets as foreign exchange, arguing they are primarily used as a cheap way to hold dollar balances.