In a significant move aimed at safeguarding the financial interests of retirees, Brazil’s primary financial policy body has enacted a ban on certain pension funds from investing in cryptocurrencies. The National Monetary Council (CMN) has made the decisive ruling to prohibit closed pension entities, known as Entidades Fechadas de Previdência Complementar (EFPCs), from allocating any portion of their guarantee reserves into popular digital currencies like bitcoin (BTC).
The EFPCs, which manage retirement savings for tens of thousands of unionized and company-employed workers, typically hold their reserves in more traditional investments such as bonds and equities. The regulatory framework has been established to mitigate potential risks associated with cryptocurrencies, which are often characterized by high volatility and unpredictable market behavior.
According to a notice from the Ministry of Finance circulating among local news outlets, the resolution explicitly prohibits investments in virtual assets, highlighting the unique investment characteristics and associated risks that come with them.
This ruling was published last week under Resolution 5.202/2025 by the CMN, marking a notable stance from Brazilian authorities regarding cryptocurrency investments.
In stark contrast, the investment landscape in the UK has seen advancements in the use of cryptocurrencies. Just last year, British pension specialists Cartwright facilitated the country’s first pension fund to allocate 3% of its assets to bitcoin. Meanwhile, various U.S. states are also beginning to explore and implement allocations for cryptocurrencies within their pension systems. For instance, the State of Wisconsin’s investment board revealed in February that it had invested $340 million in bitcoin through BlackRock’s ETF (IBIT).
It is important to note that the recent ruling from Brazil seemingly does not extend to open pension funds or individual retirement products offered by banks and insurers. These financial instruments are regulated separately and may still allow for indirect investments through vehicles such as exchange-traded funds or tokenized asset platforms.
This regulatory move reflects a cautious approach from Brazilian authorities towards the integration of cryptocurrencies into traditional financial systems, ensuring that the financial security of pension fund members remains prioritized amidst the evolving landscape of digital assets.
