Fabio Araujo, a representative of the Brazilian central bank, spoke at a public hearing before the Committee on Science, Technology, Innovation, Communication and Information Technology of the Brazilian Senate about the possible development of a digital real. Araujo made it clear that the digital real is still in the debate and they determine the demand for such an instrument.
Brazilian central bank is still debating digital real
The Brazilian central bank is still examining the creation of a digital real, according to Fabio Araujo, a representative of the institution. Araujo recently stated at a public hearing for the Senate Science, Technology, Innovation, Communications and Information Technology Committee that the bank is still debating society’s need for a central bank digital currency (CBDC). Araujo stated:
Our goal is to clarify what demands society places on Real Digital. After that, the test phase with proof of concept and possibly an innovation laboratory, which should take place in the course of 2022, will soon begin.
Araujo also announced that the Central Bank of Brazil is still having meetings with various parties that could help shape the Digital Real project. Senator Cunha, who proposed the meeting, stated that the use of digital currencies was a necessary discussion due to the lack of information on the subject. He emphasized:
We need to discuss this issue. Digitization is a reality in the lives of the population in various areas, but there is still no clearer information on how it will happen in relation to the circulation of money in Brazil.
Central bank digital currencies vs. cryptocurrency
However, this openness to the digital real, a digital central bank currency, does not lead to de facto approval of cryptocurrencies such as Bitcoin and Ethereum. Indeed, the attitude of the Brazilian central bank is negative. Araujo made it clear:
CBDCs are not to be confused with cryptoactive. The Central Bank of Brazil remains of the opinion that crypto-assets are speculative assets and pose high risk to individuals’ portfolios.
While the Brazilian central bank is still in the research phase of a hypothetical digital real, in May it issued general guidelines that such a currency must follow, showing a real interest in the subject. This puts Brazil at the forefront of central bank investigations into digital currencies in Latam, a region where central banks don’t seem too interested in the issue yet.
What do you think of Brazil’s research into a digital real? Let us know in the comments section below.
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