The Finance Shelf
Library/OpenAlex (recherche mondiale)

Beyond Kelsen and the Boi Gordo Case: The Pyramid of Responsive Regulation as a New Paradigm for Cryptoactives in the Brazilian Capital Markets (OpenAlex (recherche mondiale))

Research paperOpenAlex (recherche mondiale)November 202619 pages29 min readDaniel Hamilton Fernandes de Lima, Uinie CaminhaOriginal source
Key number
R$ 250 mil
Individual fine in G44 case p.11

Summary

  • Formal legal subsumption fails to fully address decentralized finance, tokens, and autonomous organizations, requiring criteria based on agent behavior, risk, and proportional state response [p.1].p.1
  • The Brazilian Securities and Exchange Commission (CVM) issued Deliberação CVM nº 376 in 2001 to stop unregistered sales of Boi Gordo contracts, establishing economic substance over formal contractual labels [p.6].p.6
  • In 2017, Deliberação CVM nº 785 suspended Hashcoin Brasil's offer of bitcoin mining investment group shares for operating as an unregistered collective investment contract [p.7].p.7
  • The framework maps Brazilian regulatory instruments onto Ayres and Braithwaite's responsive regulation pyramid, placing sandbox mechanisms at the base and criminal prosecution referrals at the top [p.15].p.15

Key insights

  1. Traditional binary subsumption is insufficient for cryptoassets due to their functional instability across their lifecycle [p.4].p.4
  2. CVM's Parecer de Orientação nº 40/2022 adopted a functional approach prioritizing economic essence over technical design [p.5].p.5
  3. The Boi Gordo precedent established that collective investment contracts are qualified by economic reality rather than contractual names [p.6].p.6
  4. Decisions across Hashcoin Brasil, Niobium Coin, G44, and ICONIC show consistent application of substance-over-form testing [p.8].p.8
  5. Responsive regulation enhances base-level cooperation through the credible deterrent of top-tier enforcement penalties [p.11].p.11
  6. G44's evasive corporate structuring led CVM to apply top-pyramid sanctioning tools including criminal referrals [p.14].p.14
  7. Regulatory sandboxes represent base-level responsive tools by facilitating supervised experimentation prior to full registration [p.15].p.15
  8. The regulatory shift replaces a rigid rule-fact-classification scheme with a rule-behavior-risk-proportional response model [p.16].p.16

Topics and entities

Crypto and stablecoinsRegtechRegulationBanco Central do BrasilComissão de Valores MobiliáriosFazendas Reunidas Boi Gordo S/AG44Hashcoin Brasil

Summary and figures generated from the document and checked automatically: every number shown appears on the cited page. The full document is available from the publisher. Publishers can request removal.