Brazil’s Public Prosecutor’s Office (MPF) explained that this prohibition stemmed from the pseudonymous trait of cryptocurrency, as each donation must be identified, and this requirement could be very difficult to complete with the use of these tools.
Key Takeaways:
The MPF reaffirmed a crypto donation ban on Monday, shielding Brazil’s election market from fraud.Under a Dec 17, 2019, court ruling, candidates must use Pix or traditional banking to verify 100% of funds.Brazil allows digital crowdfunding from May 15th, but forces political campaigns to log all donor IDs.The office stated that the path to financial donations for an election campaign was restricted in Brazil, as oversight bodies need to verify the origin of the funds corresponding to each donation.
The office differentiated virtual currency from virtual crowdfunding. It underscored that raising money online to finance political campaigns, as long as donors are identified accordingly, is permitted. This type of funding has been approved since 2017, when the Election Law was reformed, and is permitted starting May 15th of each election year.
Furthermore, the office clarified that candidates failing to prove the origin of their campaign funds or to disclose any donations could face fines and would have to return these funds to the treasury, facing accountability on abuse of economic power charges.
