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Brazil: XP Investimentos’ Crypto Exchange Won’t Let Users Deposit or Withdraw Bitcoin

Originally published on: CCN
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October 11, 2018


brazil bitcoin cryptocurrency

The website of XDEX, the cryptocurrency exchange launched by Brazil’s biggest investment firm, XP Investimentos, is already up and accepting pre-registrations. It adds a few details on the crypto exchange, including that users won’t be able to send BTC to and from their personal wallets.

The website, first spotted by local news outlet Portal do bitcoin, advertises commission-free bitcoin trading to its users, although it notes the platform will charge fees when they’re trading other cryptocurrencies like ethereum.

According to the company, it has a built-in transfer recognition system connected to its banks, which “ensures speed and reliability when transferring real money to buy cryptocurrencies.” While it isn’t yet clear when the exchange will open for business, its page restates users will have to open an account when it does.

The feature is interesting as earlier this year Brazil’s antitrust watchdog, the Administrative Council for Economic Defense (CADE), launched an investigation into whether the country’s banks were purposefully harming crypto exchanges by restricting their operations.

Notably, as the local news outlet points out, the crypto exchange clarifies users won’t be able to send bitcoins to or from their personal wallets. The page reads:

“Deposits, redemptions and / or transfers of digital assets / cryptocurrencies from and to a virtual wallet (E-wallet) through the XDEX platform are not permitted. The deposits / redemptions and / or transfers will be made only in reais, and the sale of the digital asset will be mandatory for the redemption in reais.”

As CCN reported, it was revealed that XP Investimentos was launching its cryptocurrency exchange earlier this year, as available data showed it registered a company called XDEX INTERMEDIACAO LTDA, whose registered capital was $7.3 million.

bitcoin wallet
Users will not be able to deposit funds from or withdraw funds to their personal bitcoin wallets.

The firm’s official announcement came near the end of September, and its president, Guilherme Benchimol, revealed that he wasn’t entirely happy with the move, as he stated: “It’s a theme, I confess, would be better not to exist.”

To this, he added:

“Today there are three million Brazilians who have exposure to bitcoin in Brazil and 500,000 people who invest in stocks. Look at the discrepancy. We felt obliged to move forward in this market.”

In Brazil, investment funds have recently been allowed to indirectly invest in cryptocurrencies, through the acquisition of derivatives and foreign funds. They aren’t allowed to directly invest in the crypto ecosystem, per the superintendent of institutional investor relations at the country’s Securities and Exchange Commission, the CVM.

Cryptocurrency exchanges in the country have been under scrutiny. In August, the government sent exchanges a 14-point questionnaire to learn more about their businesses and their potential use in money laundering, and earlier this month CADE sent them another questionnaire they’ll have to answer or face a fine that can go up to $25,000.

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