Brazil announces the launch of a test pilot of a sovereign digital currency this 2022
On Monday, the president of Brazil's central bank, Roberto Campos Neto, announced the creation of a pilot programme to develop and implement a sovereign digital currency in the Brazilian nation.
In his announcement, he said the new Central Bank Digital Currency, known as CBDC, will be active in the second half of this year and will have a fixed supply and only a certain amount will be minted, similar to how Bitcoin works.
The digital currency project makes Brazil the first South American country to develop a project to establish a sovereign digital currency. This new major asset of the country will be directly linked to the reserve transfer system, based on the national fiat payment system.
"This (using the RTS in Real Digital) is a way to create the digitalisation of the currency without creating a break in the banks' balance sheets. This project should have some kind of pilot in the second half of the year," Campos Neto said.
As part of the groundbreaking announcement, the president of the Central Bank spoke about the Brazilian crypto ecosystem, and assured that, currently, cryptocurrencies are still seen more as an investment than as a form of payment, which will change with the adoption of cryptocurrencies among the citizenries.
The pilot project of a CBDC is the result of several partnerships between the Brazilian Central Bank and nine other collaborating banks and will make Brazil a member of the growing list of countries favouring the adoption of cryptocurrencies.
The rise of cryptocurrencies is being taken advantage of by Jair Bolsonaro's government, which, in addition to the pilot project, is working on a cryptocurrency bill that was presented at the end of February, with the aim of controlling and regulating the crypto market. This initiative allows for a clear definition of the aspects of virtual assets and indicates the control jurisdictions that correspond to the government.
Coordinator for the Americas: José Antonio Sierra.