Brazil has implemented a significant tax reform for cryptocurrency assets, imposing a flat 17.5% income tax rate on all gains held by residents. This new policy, effective June 12, 2025, marks a major shift from the previous exemption system. 350,000 BRL (approximately $63,000) in gains previously exempted are now subject to this uniform tax structure. The move is expected to impact retail participation and trading activities, with market experts predicting a decline due to the increased financial burden for smaller traders. Institutional investors, however, may see a boost in activity as they navigate this new landscape. This policy change reflects Brazil’s efforts to generate more tax revenue and maintain robust market oversight within the cryptocurrency ecosystem.