Brazil Plans to Join The CBDC Bunch cryptocurrency

Brazil Set to Launch CBDC in 2024 Amid Growing Crypto Adoption

This year has witnessed the collapse of the Terra Luna ecosystem 

And the bankruptcy filing of multiple exchanges, which has eroded users' trust in digital assets. As a result, Central banks around the world are introducing CBDC in order to regain users' trust.

In line with this, Roberto Campos Neto, president of the Brazilian Central Bank, has announced the launch of a CBDC by 2024. The president made the announcement in a press conference on December 13.

As per the press conference, the bank will launch a CBDC pilot program with some financial institutions before expanding the usage of the central bank digital currency (CBDC). Moreover, the country has already chosen nine partners to assist it in developing a digital currency in March 2022.

However, the proposal for the launch of CBDC in Brazil was first introduced in May 2021. At the time, the Brazilian Central Bank issued general guidelines for the digitization of the Brazilian national currency, the Real.

This implies that Brazil will join the list of countries that have previously launched or are in the midst of launching their own central bank digital currency. Citing recent developments, the Brazilian Central Bank president added, 

“Greater inclusiveness, cheaper costs, intermediation, competition with lower entry barriers, risk control efficiency, data monetization, and complete tokenization of financial assets and contracts, this is what we observe in Brazil's digital economy.”

Furthermore, Roberto Campos Neto announced in April 2022 that a pilot program of the Digital Real, Brazilian CBDC, will go live in the second half of 2022. Neto also confirmed at the time that Brazilian CBDC would have a fixed supply and would be issued in limited quantities, similar to Bitcoin.

Apart from CBDC development, Brazil also introduced a crypto bill in late February 2022 to govern the crypto industry. The bill, which has been in the works for nearly three years, outlines several aspects of what defines a virtual asset, a broker or exchange, and which sections of the federal government would have jurisdiction over the matter. sbf

What lies ahead for Brazilian CBDC

Brazil is the largest South American country both in terms of land and population. Reports estimated that 16 million Brazilians, or 7.8% of the entire population, own cryptocurrency. According to Receita Federal, Brazil's tax authority, citizens traded $11.4 billion in stablecoins last year, nearly tripling the total traded in 2020.

This figure clearly indicates that Brazilian CBDC or Digital Real will undoubtedly witness enormous adoption after its initial launch. However, there is no excerpts perspective that claims that Digital Real will explode in the future; only time will tell what’s on the menu for Brazilian CBDC.

What do you think, will Brazil witness massive adoption of CBDC, or will impose similar restrictions as other countries to increase the adoption of CBDC? Share your thoughts in the comment section below.

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