Brazil’s securities regulator is moving from study to testing as it develops a framework for tokenized securities on blockchain and other distributed ledger networks.
The Comissão de Valores Mobiliários, or CVM, created a Tokenization Working Group in July with an initial 120-day mandate. The group brings together representatives from 14 areas of the regulator and can consult market associations, self-regulatory bodies and outside specialists.
Tokenization Framework Takes Shape
The working group’s mandate covers registration, custody, trading and settlement of securities through distributed ledger technology. It also examines cybersecurity, interoperability, regulatory gaps and the impact of DLT infrastructure on Brazil’s capital markets.
The regulator required the group to submit an initial proposal within 60 days. That deadline has now produced a concrete next step.
On Sept. 15, the group delivered a draft resolution proposing the Programa Piloto DLT CVM. The proposed pilot would allow market participants to test blockchain-based infrastructure across several stages of the securities lifecycle.
The proposed experiments could include:
- Stocks and debentures
- Receivables certificates
- Investment fund units
- Other securities and collective investment contracts
- Issuance, distribution, trading, custody and settlement
CVM Moves Toward Live Testing
The regulator says the pilot would assess whether DLT can operate effectively from technical, operational and legal perspectives. It would also examine interoperability between networks and identify risks, vulnerabilities and potential regulatory gaps.
The proposed tests would run for 60 days and could receive an extension of up to 30 days. CVM would monitor participating networks directly, including through mechanisms that could provide real-time read access to transaction records.
The broader working group still has a 120-day mandate, which can be extended by another 30 days. Its final report will consolidate the pilot’s findings and may inform future regulatory changes.
Brazil’s approach therefore appears to be shifting from general research toward controlled experimentation. Rather than immediately imposing permanent blockchain rules, the CVM is using a pilot environment to evaluate how tokenized securities could fit within the country’s existing capital-market structure.
