Not just encourage but will definitely happen, think of it like this, the more you tighten your grip on something that you want to control then the more that they want to resist which in this context would pave way for off shore betting so as to prevent surveillance or the regulation from reaching those people. This will also make the illegal elements much more creative on how they're going to use that regulation in their favor if evasion of the regulation isn't possible. As always, just another problem regulation that's made without any knowledge from the people that would care about it the most.
I do not see this as an issue for as as long as they are making the Brazilians to use foreign gambling sites. But regulators can do something like illiterates at times and this is another example of it. If a gambling site follow the KYC law and other laws like that, why not allow cryptocurrencies for deposit and withdrawal. The OP is just right about this. Their citizens that gamble with cryptocurrencies will prefer to gamble using foreign gambling sites.