Brazil bans crypto donations for election campaigns

Brazil's Public Prosecutor's Office (MPF) on Monday reaffirmed a ban on cryptocurrency donations to political campaigns, citing the difficulty of tracing the origin of funds. The prohibition, first set by the Superior Electoral Court in Resolution No. 23,607 in December 2019, bars candidates and parties from accepting virtual currency contributions.

The MPF explained the reasoning in a published article. All campaign donations must be traceable to a specific donor, identified by their Brazilian taxpayer ID (CPF). Bank transfers and Pix, the country's instant payment system, satisfy that requirement. Crypto transactions, the office said, are pseudonymous by design, making it hard for oversight bodies to verify the source of each donation.

Virtual crowdfunding remains legal, the MPF clarified, as long as donors are properly identified. That form of fundraising has been permitted since the 2017 reform of Brazil's Election Law and can begin on May 15 of each election year.

Candidates who fail to prove the origin of their funds or who omit donations from their campaign finance reports face fines and must return the money to the treasury. They can also be charged with abuse of economic power.

Local media reports have documented a surge in crypto use by criminal groups in Brazil, though the MPF did not cite specific cases in its statement. The ban predates that trend. The resolution itself does not address broader crypto regulation in the country, only election funding.

Brazil holds general elections every four years. The next round is scheduled for October 2026.