LATAM’s Crypto Regulation and Blockchain Frameworks in 2025: Key Changes and Industry Impact

The region, historically marked by political and economic volatility, has been able to overcome — and even leverage — these challenges to the point of becoming a unique space for the development of these technologies. Evidence is showing that these technologies are bearing fruit across the region - even with the lack of governmental support in most LATAM countries.

The crypto and blockchain ecosystem in LATAM is dynamic and expanding, and a recently released report has provided some clarity on the current state of these industries. The LATAM Blockchain Report 2025 by Sherlock Communications analyzes the current state of blockchain in eleven Latin American countries, closely examining regulatory ecosystems and emerging legal frameworks across this region.

While some countries have introduced clear and more friendly frameworks, others maintain highly restrictive measures, both for investment and for technological innovation.

This article presents an overview of the crypto market and blockchain ecosystems in Latin America, showing how different governments have shaped their regulations on the subject.

Crypto Regulation in LATAM: Overview and Updates

Crypto regulation across Latin America is still far from being uniform. While countries such as Argentina and El Salvador have adopted frameworks that are openly favourable to digital assets, other countries, such as Ecuador and Venezuela, remain restrictive or unstable. Meanwhile, markets such as Brazil, Chile, and Colombia have developed clearer rules that balance innovation with strict compliance requirements, often creating high entry barriers.

Let’s examine the crypto regulatory landscape of each country in greater detail to get a better understanding of the current state of crypto in the region, as well as the different realities and scenarios spanning the region.

Argentina: Leading LATAM Crypto Adoption and Shifting Regulation

Argentina is a striking case when it comes to crypto regulation. With the arrival of a government committed to highly liberal economic policies under the presidency of Javier Milei, the country has experienced a notable shift in regulation. With a “shadily dollarized” economy, hyperinflation and strict dollar controls, Argentineans are being pushed towards Bitcoin and stablecoins such as USDT and USDC, thereby leaning towards crypto adoption.

One of the most relevant changes was the passing of Law No. 27,739, which defines virtual assets and creates a mandatory registry for virtual asset service providers (VASPs) under the National Securities Commission (CNV). This law also updated anti-money laundering provisions, offering greater security for crypto owners and issuers.

Another relevant update was the Resolution No. 994/2024 issued by the CNV that set standards for capital, custody and audits, with foreign platforms required to register by September 2025. It further established the Register of Virtual Asset Service Providers (PSAVs), paving the way for broader financial use of crypto assets.

In addition, although commercial banks still cannot run crypto spot desks, the CNV has approved peso-denominated deposit certificates in US Bitcoin and Ether ETFs — another signal of institutional openness. Similarly, a tax-amnesty window allows residents to declare up to USD 100,000 in crypto tax-free.

This shift towards a crypto-friendly environment has made Argentina one of the region’s most welcoming settings for crypto investment. Argentina’s crypto adoption continues to grow, surpassing its neighbour, Brazil, with $91 billion on-chain between July 2023 and June 2024.

Brazil: Institutional Openness and an Evolving Regulatory Framework

Brazil stands out for the institutional support of its government towards crypto and blockchain technologies. The country offers one of the clearest legal frameworks for crypto in the region and has consistently focused on integrating blockchain into both public and private financial systems. In fact, up to 2023, crypto adoption had been led by exchanges and ETFs, but, since then, the country has approved different crypto-friendly regulations.

Being the largest crypto market in Latin America, Brazil has consistently experienced significant growth in both crypto adoption and institutional involvement, including the development of the Central Bank Digital Currency (CBDC) and real-world asset tokenization projects.

A clear example is the Virtual Assets Act (Law No. 14,478/22), that entered in force in June 2023 and provides a resilient framework for the sector, specifically handing oversight to the Central Bank (BCB) and CVM, criminalising crypto fraud, and requiring licences for VAPs.

However, the main challenge remains taxation: since 2024, a15% levy has applied to profits from crypto held on foreign exchanges. Likewise, Decree No. 12,466/2025 raised the IOF-FX rate to 3.5% on most outbound transfers and international card funding — although the tax hits only the foreign-exchange leg. On-shore crypto trades, including BRL-stablecoin swaps, remain IOF-free, a gap that has boosted domestic stablecoin activity.

Overall, although Brazil’s crypto regulation still has clear frameworks and allows blockchain solutions to enter the country, the recent changes increasing taxation are not a good sign and may have the potential to drive the domestic market abroad.

Chile: Balancing Innovation with Compliance

Chile has adopted one of the region’s most proactive attitudes towards crypto regulation — though approaches with caution.

In 2024, with the approval of the Fintech Law, the country incorporated crypto assets and stablecoins into its monetary framework, creating a formal licensing regime under the oversight of the Financial Market Commission (CMF). In the same year, the CMF issued General Rule No. 502 that sets out registration and compliance requirements for Virtual Assets Service Providers.

Although not recognised as legal tender, these regulations established that these assets may be used as a permitted means of payment, becoming one of the first countries to legally recognise fiat-backed stablecoins. This means that non-bank companies can issue and operate stablecoins in the country.

With one of the most comprehensive crypto frameworks in Latin America, Chile is open to innovation but under clear supervision.

Colombia: Seeking Crypto-Friendly Regulation While Protecting Customers

Colombia’s crypto regulation is still in an experimental stage. The country’s regulatory approach to crypto has been proactive but cautious, positioning itself towards policies favourable to cryptocurrency adoption. No comprehensive law exists yet, though draft legislation is under debate in Congress. For instance, in March 2025, Colombian lawmakers reintroduced a major crypto regulation aiming to license and oversee VASPs and bring crypto companies under clear supervision.

Although crypto trading is legal in the country, the Financial Superintendence (SFC) has not yet authorized banks to directly broker crypto. Nonetheless, the government has launched a regulatory sandbox known as “La Arenera”, which allows banks to pilot services in collaboration with exchanges. According to SFC, this pilot helped prove that risks can be managed and further set the stage for permanent regulations.

In conclusion, the Colombian regulator’s stance towards crypto focuses on balancing consumer protection, preventing illicit use, with innovation.

Mexico: Cautious Acceptance and Incremental Oversight

Despite its challenges, Mexico’s crypto market shows growing adoption, driven by remittances, mainstream use and innovative blockchain projects. Yet, the country has no dedicated crypto regulation in force. The country’s stance towards crypto is one of cautious acceptance and incremental oversight.

Its core framework remains anchored in the oversight of the Bank of Mexico (Banxico), established by the 2018 Fintech Law — which officially recognises crypto as a “virtual asset”, and thereby legally valid means for payments and electronic transactions. However, there is slow progress in new crypto laws and the Mexican authorities have adopted a cautious approach, with an emphasis on risk disclosure, AML compliance and a delay in the launch of the digital peso.

Mexico’s stance can be viewed as neutral towards crypto: neither too friendly, nor too hostile. The official position remains defined by cautious acceptance. Although the country is open to crypto businesses, it is not proactively incentivising crypto adoption in the country — as is the case with some of its Latin American neighbours.

Let’s Take a Look into Other LATAM Countries and Their Crypto Frameworks

• Costa Rica

Although no fully structured crypto framework is in place,Costa Rica is considered crypto-friendly all the same, allowing trading and mining while providing few consumer protections. The MECA Bill (No. 23,415) has been under discussion since 2024, which would define cryptocurrencies as “private virtual money”, thereby protecting citizens’ rights to hold these assets. Overall, the country demonstrates an open environment for foreign teams and projects, with low tax rates and renewable energy.

• Ecuador

Ecuador has taken a restrictive, hostile approach towards crypto. Article 94 of the country’s Organic Monetary and Financial Code explicitly prohibits the use of crypto as a means of payment, even though the buying and selling of crypto is permitted. Resolution JPRM-2023-014-M set rules for digital wallets, while the “Ley Antipillos” (Dec 2024) established that profits from crypto must be declared in annual income tax returns.

• El Salvador

Perhaps the most emblematic and well-known case in the region, El Salvador has one of the friendliest crypto regulatory frameworks in the world. The country adopted Bitcoin as legal tender through the 2021 Bitcoin Law, even placing part of its national reserves in the asset — yet, government crypto initiatives have yet to meaningfully penetrate daily financial life in the majority of households.

In January 2025, reforms were introduced that removed Bitcoin’s mandatory status, making its acceptance optional. This reflects a desire to align Bitcoin’s use more closely with local realities, while remaining one of the most crypto-friendly nations globally.

• Paraguay

Paraguay finds itself in regulatory limbo.No comprehensive law exists, and while crypto activity is tolerated, it is not encouraged. The country’s crypto market remains small and mining‐centric. Beyond mining, crypto usage is nascent.

• Peru

Peru is an emerging crypto market that’s gradually moving towards greater supervision: its regulatory stance remains crypto-permissive, but increasingly supervised.

Recent advances include the approval of Resolution No. 02648 (2024), which applies anti-money laundering laws to exchanges, and a planned Income Tax Law. The country proposes gradual integration — with a tax plan and bank sandbox — to incorporate crypto into mainstream finance. Overall, the country is moving from a legal gray zone into a more structured, innovation-oriented framework.

• Venezuela

The Venezuelan ecosystem is highly volatile. Since 2023, the national regulator (SUNACRIP) has been paralysed amid an oil-for-crypto corruption scandal, leaving the rules uncertain for businesses and users.

Technically, the country requires all crypto exchanges and remittance platforms to be licensed by SUNACRIP; yet, with the regulator in limbo, legitimate licensing has stalled. In practice, Venezuela’s government stance has tilted toward punitive enforcement rather than crypto-friendly innovation.

Blockchain Regulations — Advances Across the Region

In contrast to the varied approaches to crypto, blockchain itself has generally received favourable treatment within the Latin American region. Key developments include:

• Argentina — Approval of Resolution No. 1069 by the National Securities Commission, allowing for broader financial application of blockchain technology.
• Brazil — The CVM Circular No. 04/2023 strengthened the use of blockchain in capital markets.
• El Salvador — Adoption of the Law for the Promotion of Innovation and Technology Manufacturing, which grants tax exemptions to companies within the sector.
• Peru — Approval of Law No. 32,270 in December 2024, which regulates digital voting using blockchain and creates a sandbox for the central bank’s digital currency (CBDC).
• Venezuela — Regulatory inconsistency, with frequent and arbitrary changes, creating instability and increasing operational risks for investors.

Regional Regulatory Framework Overview

Broadly speaking, LATAM countries can be grouped into three categories:

• Friendly — Argentina, El Salvador, Brazil, Costa Rica and Peru, which promote innovation and actively seek to attract capital and startups.
• Friendly & Structured, Yet Cautious — Chile, Colombia and Mexico, which have clear regulatory frameworks but impose heavy compliance or taxation burdens.
• Non-Friendly, Restrictive or Unstable — Ecuador, Venezuela and Paraguay, which show hostility or, at best, neutrality without institutional support, deterring investment.

For companies looking to learn more about crypto and blockchain frameworks in the region, these dynamics are explored in depth in the LATAM Blockchain Report 2025.

Key Outcomes of Crypto & Blockchain Regulation in Latin America

Three elements stand out in 2025. First, regulatory predictability remains essential for attracting foreign capital. Second, taxation plays a decisive role in shaping investment flows. Finally, there is a growing perception that blockchain adoption is advancing independently of crypto, particularly in areas such as digital voting and open banking.

Differences in crypto regulation across Latin America mirror the region’s own political, financial and cultural diversity. While some countries are ready to embrace innovation and turn it into an engine of growth, others put up barriers or pursue unstable paths that hinder development.

Players who can align their strategies with the realities of each market will be better positioned to transform a scenario of uncertainty into a platform for sustainable growth.

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In 2025, the crypto and blockchain market in Latin America has reached a new stage of maturity, accompanied by increasing regulatory complexity.

The region, historically marked by political and economic volatility, has been able to overcome — and even leverage — these challenges to the point of becoming a unique space for the development of these technologies. Evidence is showing that these technologies are bearing fruit across the region - even with the lack of governmental support in most LATAM countries.

The crypto and blockchain ecosystem in LATAM is dynamic and expanding, and a recently released report has provided some clarity on the current state of these industries. The LATAM Blockchain Report 2025 by Sherlock Communications analyzes the current state of blockchain in eleven Latin American countries, closely examining regulatory ecosystems and emerging legal frameworks across this region.

While some countries have introduced clear and more friendly frameworks, others maintain highly restrictive measures, both for investment and for technological innovation.

This article presents an overview of the crypto market and blockchain ecosystems in Latin America, showing how different governments have shaped their regulations on the subject.

Crypto Regulation in LATAM: Overview and Updates

Crypto regulation across Latin America is still far from being uniform. While countries such as Argentina and El Salvador have adopted frameworks that are openly favourable to digital assets, other countries, such as Ecuador and Venezuela, remain restrictive or unstable. Meanwhile, markets such as Brazil, Chile, and Colombia have developed clearer rules that balance innovation with strict compliance requirements, often creating high entry barriers.

Let’s examine the crypto regulatory landscape of each country in greater detail to get a better understanding of the current state of crypto in the region, as well as the different realities and scenarios spanning the region.

Argentina: Leading LATAM Crypto Adoption and Shifting Regulation

Argentina is a striking case when it comes to crypto regulation. With the arrival of a government committed to highly liberal economic policies under the presidency of Javier Milei, the country has experienced a notable shift in regulation. With a “shadily dollarized” economy, hyperinflation and strict dollar controls, Argentineans are being pushed towards Bitcoin and stablecoins such as USDT and USDC, thereby leaning towards crypto adoption.

One of the most relevant changes was the passing of Law No. 27,739, which defines virtual assets and creates a mandatory registry for virtual asset service providers (VASPs) under the National Securities Commission (CNV). This law also updated anti-money laundering provisions, offering greater security for crypto owners and issuers.

Another relevant update was the Resolution No. 994/2024 issued by the CNV that set standards for capital, custody and audits, with foreign platforms required to register by September 2025. It further established the Register of Virtual Asset Service Providers (PSAVs), paving the way for broader financial use of crypto assets.

In addition, although commercial banks still cannot run crypto spot desks, the CNV has approved peso-denominated deposit certificates in US Bitcoin and Ether ETFs — another signal of institutional openness. Similarly, a tax-amnesty window allows residents to declare up to USD 100,000 in crypto tax-free.

This shift towards a crypto-friendly environment has made Argentina one of the region’s most welcoming settings for crypto investment. Argentina’s crypto adoption continues to grow, surpassing its neighbour, Brazil, with $91 billion on-chain between July 2023 and June 2024.

Brazil: Institutional Openness and an Evolving Regulatory Framework

Brazil stands out for the institutional support of its government towards crypto and blockchain technologies. The country offers one of the clearest legal frameworks for crypto in the region and has consistently focused on integrating blockchain into both public and private financial systems. In fact, up to 2023, crypto adoption had been led by exchanges and ETFs, but, since then, the country has approved different crypto-friendly regulations.

Being the largest crypto market in Latin America, Brazil has consistently experienced significant growth in both crypto adoption and institutional involvement, including the development of the Central Bank Digital Currency (CBDC) and real-world asset tokenization projects.

A clear example is the Virtual Assets Act (Law No. 14,478/22), that entered in force in June 2023 and provides a resilient framework for the sector, specifically handing oversight to the Central Bank (BCB) and CVM, criminalising crypto fraud, and requiring licences for VAPs.

However, the main challenge remains taxation: since 2024, a15% levy has applied to profits from crypto held on foreign exchanges. Likewise, Decree No. 12,466/2025 raised the IOF-FX rate to 3.5% on most outbound transfers and international card funding — although the tax hits only the foreign-exchange leg. On-shore crypto trades, including BRL-stablecoin swaps, remain IOF-free, a gap that has boosted domestic stablecoin activity.

Overall, although Brazil’s crypto regulation still has clear frameworks and allows blockchain solutions to enter the country, the recent changes increasing taxation are not a good sign and may have the potential to drive the domestic market abroad.

Chile: Balancing Innovation with Compliance

Chile has adopted one of the region’s most proactive attitudes towards crypto regulation — though approaches with caution.

In 2024, with the approval of the Fintech Law, the country incorporated crypto assets and stablecoins into its monetary framework, creating a formal licensing regime under the oversight of the Financial Market Commission (CMF). In the same year, the CMF issued General Rule No. 502 that sets out registration and compliance requirements for Virtual Assets Service Providers.

Although not recognised as legal tender, these regulations established that these assets may be used as a permitted means of payment, becoming one of the first countries to legally recognise fiat-backed stablecoins. This means that non-bank companies can issue and operate stablecoins in the country.

With one of the most comprehensive crypto frameworks in Latin America, Chile is open to innovation but under clear supervision.

Colombia: Seeking Crypto-Friendly Regulation While Protecting Customers

Colombia’s crypto regulation is still in an experimental stage. The country’s regulatory approach to crypto has been proactive but cautious, positioning itself towards policies favourable to cryptocurrency adoption. No comprehensive law exists yet, though draft legislation is under debate in Congress. For instance, in March 2025, Colombian lawmakers reintroduced a major crypto regulation aiming to license and oversee VASPs and bring crypto companies under clear supervision.

Although crypto trading is legal in the country, the Financial Superintendence (SFC) has not yet authorized banks to directly broker crypto. Nonetheless, the government has launched a regulatory sandbox known as “La Arenera”, which allows banks to pilot services in collaboration with exchanges. According to SFC, this pilot helped prove that risks can be managed and further set the stage for permanent regulations.

In conclusion, the Colombian regulator’s stance towards crypto focuses on balancing consumer protection, preventing illicit use, with innovation.

Mexico: Cautious Acceptance and Incremental Oversight

Despite its challenges, Mexico’s crypto market shows growing adoption, driven by remittances, mainstream use and innovative blockchain projects. Yet, the country has no dedicated crypto regulation in force. The country’s stance towards crypto is one of cautious acceptance and incremental oversight.

Its core framework remains anchored in the oversight of the Bank of Mexico (Banxico), established by the 2018 Fintech Law — which officially recognises crypto as a “virtual asset”, and thereby legally valid means for payments and electronic transactions. However, there is slow progress in new crypto laws and the Mexican authorities have adopted a cautious approach, with an emphasis on risk disclosure, AML compliance and a delay in the launch of the digital peso.

Mexico’s stance can be viewed as neutral towards crypto: neither too friendly, nor too hostile. The official position remains defined by cautious acceptance. Although the country is open to crypto businesses, it is not proactively incentivising crypto adoption in the country — as is the case with some of its Latin American neighbours.

Let’s Take a Look into Other LATAM Countries and Their Crypto Frameworks

• Costa Rica

Although no fully structured crypto framework is in place,Costa Rica is considered crypto-friendly all the same, allowing trading and mining while providing few consumer protections. The MECA Bill (No. 23,415) has been under discussion since 2024, which would define cryptocurrencies as “private virtual money”, thereby protecting citizens’ rights to hold these assets. Overall, the country demonstrates an open environment for foreign teams and projects, with low tax rates and renewable energy.

• Ecuador

Ecuador has taken a restrictive, hostile approach towards crypto. Article 94 of the country’s Organic Monetary and Financial Code explicitly prohibits the use of crypto as a means of payment, even though the buying and selling of crypto is permitted. Resolution JPRM-2023-014-M set rules for digital wallets, while the “Ley Antipillos” (Dec 2024) established that profits from crypto must be declared in annual income tax returns.

• El Salvador

Perhaps the most emblematic and well-known case in the region, El Salvador has one of the friendliest crypto regulatory frameworks in the world. The country adopted Bitcoin as legal tender through the 2021 Bitcoin Law, even placing part of its national reserves in the asset — yet, government crypto initiatives have yet to meaningfully penetrate daily financial life in the majority of households.

In January 2025, reforms were introduced that removed Bitcoin’s mandatory status, making its acceptance optional. This reflects a desire to align Bitcoin’s use more closely with local realities, while remaining one of the most crypto-friendly nations globally.

• Paraguay

Paraguay finds itself in regulatory limbo.No comprehensive law exists, and while crypto activity is tolerated, it is not encouraged. The country’s crypto market remains small and mining‐centric. Beyond mining, crypto usage is nascent.

• Peru

Peru is an emerging crypto market that’s gradually moving towards greater supervision: its regulatory stance remains crypto-permissive, but increasingly supervised.

Recent advances include the approval of Resolution No. 02648 (2024), which applies anti-money laundering laws to exchanges, and a planned Income Tax Law. The country proposes gradual integration — with a tax plan and bank sandbox — to incorporate crypto into mainstream finance. Overall, the country is moving from a legal gray zone into a more structured, innovation-oriented framework.

• Venezuela

The Venezuelan ecosystem is highly volatile. Since 2023, the national regulator (SUNACRIP) has been paralysed amid an oil-for-crypto corruption scandal, leaving the rules uncertain for businesses and users.

Technically, the country requires all crypto exchanges and remittance platforms to be licensed by SUNACRIP; yet, with the regulator in limbo, legitimate licensing has stalled. In practice, Venezuela’s government stance has tilted toward punitive enforcement rather than crypto-friendly innovation.

Blockchain Regulations — Advances Across the Region

In contrast to the varied approaches to crypto, blockchain itself has generally received favourable treatment within the Latin American region. Key developments include:

• Argentina — Approval of Resolution No. 1069 by the National Securities Commission, allowing for broader financial application of blockchain technology.
• Brazil — The CVM Circular No. 04/2023 strengthened the use of blockchain in capital markets.
• El Salvador — Adoption of the Law for the Promotion of Innovation and Technology Manufacturing, which grants tax exemptions to companies within the sector.
• Peru — Approval of Law No. 32,270 in December 2024, which regulates digital voting using blockchain and creates a sandbox for the central bank’s digital currency (CBDC).
• Venezuela — Regulatory inconsistency, with frequent and arbitrary changes, creating instability and increasing operational risks for investors.

Regional Regulatory Framework Overview

Broadly speaking, LATAM countries can be grouped into three categories:

• Friendly — Argentina, El Salvador, Brazil, Costa Rica and Peru, which promote innovation and actively seek to attract capital and startups.
• Friendly & Structured, Yet Cautious — Chile, Colombia and Mexico, which have clear regulatory frameworks but impose heavy compliance or taxation burdens.
• Non-Friendly, Restrictive or Unstable — Ecuador, Venezuela and Paraguay, which show hostility or, at best, neutrality without institutional support, deterring investment.

For companies looking to learn more about crypto and blockchain frameworks in the region, these dynamics are explored in depth in the LATAM Blockchain Report 2025.

Key Outcomes of Crypto & Blockchain Regulation in Latin America

Three elements stand out in 2025. First, regulatory predictability remains essential for attracting foreign capital. Second, taxation plays a decisive role in shaping investment flows. Finally, there is a growing perception that blockchain adoption is advancing independently of crypto, particularly in areas such as digital voting and open banking.

Differences in crypto regulation across Latin America mirror the region’s own political, financial and cultural diversity. While some countries are ready to embrace innovation and turn it into an engine of growth, others put up barriers or pursue unstable paths that hinder development.

Players who can align their strategies with the realities of each market will be better positioned to transform a scenario of uncertainty into a platform for sustainable growth.