Bybit has become the latest digital assets exchange booted out of the Brazilian market over its alleged unregistered securities offering. The country’s securities watchdog has ordered the Singaporean exchange to cease operations immediately or face a daily fine.
Brazil’s Securities and Exchange Commission (CVM) published a declaratory act this week stating that Bybit doesn’t have the authority to act as a securities intermediary.
CVM called for “the immediate suspension of the broadcasting of any public offer of securities intermediation services, directly or indirectly, including through the use of internet pages, applications or social networks.”
Failure to suspend the services immediately will attract a daily fine of R$ 1,000 ($190).
The suspension comes just four months since Bybit made its foray into Brazil, a country whose 212 million people can be a lucrative market for any digital asset company. Bybit described the move as a starting point for its expansion into Latin America. It initially allowed users to purchase digital assets through Brazilian reals, leveraging the PIX real-time payment system. It also offered a non-fungible token (NFT) marketplace.
“Brazilians highly value their experience with the services they use. When it comes to investments, we know that we will only be successful by offering world class liquidity and reliability that users expect of Bybit,” the exchange said at the time.
Notably, when making its entry into Brazil, Bybit claimed it was keen not to make the mistakes that Binance did which got the latter booted out of the country. As CoinGeek reported, CVM blocked Binance from offering its services back in 2020 and threatened it with a daily fine as well.
Coinbase (NASDAQ: COIN) has also given the Brazilian market a crack, attempting to purchase the country’s largest exchange, Mercado Bitcoin, which is valued at over $2 billion. However, acquisition talks fell through recently.
Bybit is no stranger to regulatory trouble. Earlier this year, South African regulators identified the exchange as one of the VASPs serving in the market illegally, alongside Sam Bankman-Fried’s FTX. The Ontario Securities Commission (OSC) banned Bybit from operating in Canada last year, Spain’s securities watchdog prohibited its operations in the country, Japan alleged it was operating illegally, and the U.K’s FCA ordered it to shut down operations in March.
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