Argentine cryptocurrency platform Lemon is withdrawing from Brazil, citing the high capital demands of the country’s new virtual-asset service provider rules. The company will terminate remaining local accounts and shift resources to operations in Argentina, Peru and Colombia.

Lemon determined that the capital commitment required under Brazil’s regulatory framework for virtual-asset service providers, known as PSAVs, was disproportionate to the size of its Brazilian customer base and revenue. The platform entered the Brazilian market in March 2022 and recently introduced a Visa-branded payment card in partnership with infrastructure provider Pomelo. That card will cease processing transactions on September 30.

Account Closures and Customer Support

Approximately 15,000 Brazilian users still hold balances on the platform. Lemon has already suspended new deposits in Brazilian reais. The company plans to contact each affected customer individually and assist with withdrawals before automatically closing the remaining accounts on October 16.

The account deadline falls two weeks before Brazil’s first-stage licensing filing date of October 30. Under the framework that took effect on February 2, providers continuing to operate without approval after the deadline face restrictions on serving the Brazilian market.

Capital Thresholds and Industry Impact

Brazil’s PSAV rules set capital requirements that vary by type of crypto activity, ranging from 10.8 million to 37.2 million Brazilian reais, equivalent to roughly $2.1 million to $7.2 million. Firms must also cover technology, compliance, reporting and other operating costs.

Lemon is not alone in adjusting its Brazilian presence. Coinext shut down after failing to meet the minimum capital threshold, while Digitra ended its retail trading service. Crypto.com is retaining its Brazilian entity but plans to close accounts denominated in reais on October 25.

Larger operators are continuing to invest. Binance has obtained regulatory approval in the country, and Ripple is pursuing a local virtual-asset service provider licence as it expands use of its RLUSD stablecoin. Coinbase has expanded access to USDC lending products in Brazil through Morpho. Binance has also relaunched its Brazilian crypto card through Mastercard after a two-year absence.

Reallocation Across Latin America

Lemon will redirect the capital freed by the Brazilian exit toward its remaining regional operations. The company described Argentina’s regulatory system as offering clear rules and a security environment. Bitcoin purchases through Lemon in Argentina recently reached a 20-month high, according to the firm.

In Peru, Lemon reports more than one million users and holds a licence from the country’s banking and insurance supervisor. In Colombia, where it has more than 150,000 users, the company intends to devote additional resources to its existing operation. The move is framed as a reallocation rather than a broader withdrawal from Latin America.

Brazil remains one of the region’s most active cryptocurrency markets. Local lawmakers are considering a proposal for a national Bitcoin reserve that could eventually hold as much as one million BTC, though the measure remains separate from the central bank’s licensing regime and has not created a purchase commitment.

Users with remaining balances on Lemon’s Brazilian platform have until October 16 to complete withdrawals, while cardholders will lose access to Lemon Card payments after September 30.