BitGo stakes claim in Brazil banking ahead of crypto reform

As Brazil moves toward stricter crypto regulation, BitGo is making a timely play to become the country’s go-to institutional custodian.

By launching a fully regulated subsidiary in São Paulo ahead of potential laws requiring domestic key management, the firm is positioning itself as the default solution for banks and asset managers navigating Brazil’s fast-evolving digital asset landscape.

On July 25, crypto custody giant BitGo announced the official launch of BitGo Brasil Tecnologia Ltda., a fully regulated subsidiary aimed at serving the country’s banks, brokerages, and asset managers.

According to BitGo, the move comes as Brazil’s legislature debates stricter rules for virtual asset service providers, including potential requirements for domestic key management, a capability BitGo has already built into its infrastructure.

By establishing a physical presence now, the firm is positioning itself as the default institutional custodian before competitors can react.

BitGo’s Brazil pivot: why now?

BitGo’s Brazilian expansion can be interpreted as a calculated response to three converging factors: regulatory momentum, institutional demand, and Brazil’s unique position in Latin America’s crypto economy. The country’s Congress is currently refining legislation that could require financial institutions to store digital assets with locally domiciled custodians, a move mirroring Europe’s MiCA framework.

BitGo, fresh off securing its MiCA license in Germany, is replicating that playbook by establishing physical infrastructure ahead of the rules.

“We want banks to see us as allies,” Luis Ayala, BitGo’s LatAm Director, said. “We are prepared to meet any demands that arise, with security, technology, and respect for local laws. Even if the legislation takes another path, we will remain here as partners of Brazilian institutions.”

For Brazil’s financial giants, BitGo’s arrival solves a pressing dilemma. Major banks, such as Itaú and Bradesco, have cautiously explored crypto services but have lacked a custody partner that combines institutional-grade security with on-the-ground compliance.

BitGo Brasil will offer insured cold storage, OTC trading desks, and automated treasury tools, all of which will be operated within the Brazilian jurisdiction. Crucially, the subsidiary provides audit-ready APIs tailored to local accounting standards, a feature that matters deeply for auditors at firms like PwC and KPMG Brazil.

The timing also reflects Brazil’s maturation beyond retail crypto speculation. With the Central Bank piloting its Drex digital currency and asset managers like XP Inc. launching Bitcoin ETFs, institutions need infrastructure that bridges traditional finance and blockchain.

BitGo’s European track record, including its partnership custody assets for firms like CoinList and Swan Bitcoin, gives it credibility, but its localization strategy is what sets it apart.