Brazil’s CVM Launches Strategic Working Group to Regulate Securities Tokenization
Brazil’s Securities and Exchange Commission (CVM) has taken the first steps toward regulating securities tokenization by establishing a working group to propose rules and regulations. The initiative addresses surging local demand, with tokenization volumes expected to pass $740 million in 2025.
The CVM announced on Friday that the group will experiment with and test onchain securities to regulate key activities such as registration, deposit, custody, trading, and settlement of security tokens. The group’s responsibilities include conducting comparative studies, analyzing regulatory sandbox results, promoting debates with regulators and market participants, and assessing the impact of decentralized technologies on the capital market.
Composed of 14 CVM employees and participants from other parties, the group will also evaluate cybersecurity and other aspects to improve current regulations, laying what the CVM called “the foundation of future regulation for securities tokenization.” The initiative highlights the relevance of these technologies to Brazil’s financial markets, where investors have raised millions of dollars through crowdfunding offers.
CVM President Otto Lobo described tokenization as “a structural transformation of the capital market” requiring innovative regulatory action. “With this Working Group, the CVM brings together technical knowledge to assess opportunities, face challenges, and build, in a coordinated manner, the foundations for a modern, secure regulatory environment aligned with the evolution of the Brazilian capital market,” he said.
The group will initially operate for 120 days, with a possible 30-day extension. Within the first 60 days, it will deliver a proposal for an experimental regulatory regime for securities tokenization. At the end of its activity, it will provide a conclusive report with regulatory recommendations.