Coinbase Fights Brazil’s Ban on Self-Hosted Stablecoin Withdrawals

Brazilian regulators are proposing a new regulation that would prohibit withdrawing stablecoins to self-hosted wallets, citing concerns over tax evasion and money laundering. They argue that transactions from such wallets are difficult to track, potentially allowing for illicit financial flows. Coinbase, however, is pushing back against these restrictions, warning that they could negatively impact businesses and individuals using stablecoins for cross-border transactions, payrolls, remittances, and daily spending. Tom Duff Gordon from Coinbase emphasized the critical role of self-custodial wallets in fostering decentralized finance and maintaining asset control, urging regulators to consider alternative measures such as enhanced blockchain analytics, improved reporting mechanisms, and stricter monitoring. The conflict highlights the ongoing tug-of-war between regulatory efforts to curb financial crime and the need to maintain innovation and inclusivity in the digital economy. The outcome of this regulatory debate could influence the future trajectory of crypto adoption in Brazil.