Brazil Targets $43B Crypto Flows With FX Tax; Venezuela Pivots to Gas Mining

Latin America’s largest crypto market is moving to tax the plumbing of cross-border payments, just as Venezuela attempts to monetize its wasted energy reserves in a desperate bid for revenue.

Brazil Closes the Stablecoin Loophole

The Brazilian Finance Ministry is finalizing a decree to classify crypto assets, specifically dollar-pegged stablecoins, as foreign exchange (FX) operations, effectively subjecting them to the Tax on Financial Operations (IOF). This move targets a massive regulatory arbitrage: Federal Revenue data confirms crypto transactions hit R$227 billion (~$43 billion) in H1 2025, with USDT accounting for two-thirds of that volume.

By layering the IOF on top of the recently enacted 17.5% flat tax on capital gains (which scrapped exemptions for sales under R$35,000), Brasília aims to capture revenue from importers and remittance firms using crypto rails to bypass traditional FX spreads. Industry analysts estimate the new classification could add up to 6% in fees to cross-border crypto settlements, potentially forcing volume back to banking channels or into non-compliant P2P markets.

The visibility of crypto transactions potentially subject to the IOF will help combat import tax evasion: “If you import machinery… and send the other 80% via USDT without paying customs duties, IOF is the least of your problems.”, Federal Police Official

Venezuela’s Flared Gas Hail Mary

While Brazil tightens its grip, Venezuela is pitching a contrarian open door. With the state oil company PDVSA pledging $7 billion to cut gas flaring by 71% by 2030, the Maduro administration is courting Bitcoin miners to set up mobile units directly at oil fields. The country currently burns off nearly 46% of its daily natural gas production. Energy that is otherwise completely stranded.

The timing is critical. Bitcoin mining difficulty recently dropped 11% (the steepest decline since China’s 2021 ban), but hashprice remains near historic lows of $0.03/TH. At these margins, only operators with near-zero energy costs can survive. Venezuela’s pitch capitalizes on this distress, offering access to gas that would otherwise be vented into the atmosphere, though political risk remains the primary barrier to institutional capital entry.

Market Reaction

Bitcoin (BTC) largely ignored the regional policy shifts, trading flat at $70,800 (+2.3%) as the market focused on broader macro signals. However, the divergence highlights a deepening split in LATAM’s crypto economy: Brazil is integrating digital assets into its high-tax formal banking system, while Venezuela seeks to use them as a sovereign energy monetization tool.