Brazil's securities regulator, the Comissão de Valores Mobiliários (CVM), has established a dedicated working group to examine how distributed ledger technology (DLT) could be incorporated into core securities activities, including the registration, custody, trading and settlement of securities. The group was created under CVM Portaria 177, published on July 17, 2026. In this context, tokenization refers to representing securities and the processes around them—issuance, custody, trading and settlement—as digital records maintained on distributed ledgers, placing the review squarely within the core infrastructure of Brazil's capital markets.

A 120-Day Mandate

Known as the Grupo de Trabalho de Tokenização (GTT), the working group has an initial mandate of 120 days, with the possibility of a 30-day extension. It brings together representatives from 14 organizational units within the CVM and may additionally engage government bodies, self-regulatory organizations, market associations and invited specialists.

The group's responsibilities include studying tokenization initiatives in Brazil and other jurisdictions, reviewing the results of regulatory sandbox programs, consulting with market participants, and assessing how distributed ledger technology could affect the structure and operation of Brazil's capital markets. It is also tasked with examining cybersecurity issues and identifying potential changes to Brazil's existing regulatory framework, with the broader objective of establishing the foundations for future regulation of securities tokenization. The sandbox review gives the regulator a base of supervised, real-world test results to draw on rather than theoretical analysis alone as it weighs how, if at all, the existing framework should be adapted.

Experimental Regulatory Framework Planned

The CVM set an earlier milestone for the initiative: within 60 days of its establishment, the working group was required to submit a proposal for an experimental regulatory regime covering tokenized securities.

That work has since advanced. On Sept. 15, the GTT submitted a draft resolution proposing the creation of the DLT CVM Pilot Program, which would allow experimental testing of the issuance, offering, distribution, trading, registration, custody, central deposit and settlement of securities using distributed ledger technology.

The proposed pilot would assess the technical, operational and legal feasibility of DLT-based securities transactions, examine interoperability between networks, and identify risks, vulnerabilities and potential regulatory gaps. Pilot programs of this kind allow regulators to observe live transactions under controlled conditions and gather evidence before permanent rules are written, an evidence-first approach consistent with the CVM's sandbox experience.

Brazil Examines Securities Tokenization

The CVM's existing framework distinguishes between different types of crypto assets. The regulator has said its authority applies to crypto assets that qualify as securities, including representations of traditional securities, tokenized receivables certificates and certain publicly offered investment contracts. Bitcoin and most cryptocurrencies that are not classified as securities generally fall outside the CVM securities-market jurisdiction.

Under the proposed pilot, experimental transactions could include shares, debentures, receivables certificates, investment-fund units and other securities or collective investment contracts. The tests are designed to generate evidence that can inform potential regulatory improvements.

The working group's initial 120-day mandate remains the formal framework for its broader study, while the CVM's pilot proposal provides the regulator with a concrete mechanism for testing tokenized securities before determining potential changes to the regulatory framework. With the draft resolution now on the table, the developments to watch are whether the DLT CVM Pilot Program moves from proposal to operation, what the feasibility and interoperability tests uncover, and what recommendations the GTT delivers as its mandate—extendable by 30 days—runs toward conclusion.

Source: Hokanews