The Central Bank of Brazil launched this Monday a pilot project aimed at implementing a cryptocurrency, which is a “tokenized” version of the real, the current currency in the country, and which is expected to be made available to the public at the end of 2024.
The so-called “digital real” will be similar to bitcoin, in the sense that it is a digital currency that will facilitate transactions, but it will be issued by the Central Bank of Brazil and its value will be equal to that of paper money.
The pilot project began with the implementation of a platform to carry out simulated transactions of public securities between the Central Bank and a small group of financial institutions, which have not yet been selected.
The digital real will be in the testing phase, foreseeably until the end of 2024, but the schedule is open to eventual modifications, according to those responsible for the project at a press conference.
The coordinator of the project, Fábio Araújo, affirmed that the digital real has the capacity to promote a “profound alteration of the financial market” and, therefore, all the central banks of the world “are very interested” in the development of similar tools.
Among its objectives, the cryptocurrency aims to promote a higher level of financial inclusion, by making transactions cheaper and “democratizing” investment, credit and insurance tools, according to a document with the project guidelines, presented by the issuing entity.
In the document, the Central Bank notes that the use of cryptocurrencies presents a growing trend in the market and points out that, due to the lack of a currency backed by the issuer, institutions have been forced so far to use the so-called “stablecoins”. .
These privately issued digital currencies, whose value is normally linked to the dollar, lack proper regulation, exposing market players to risks that may “compromise their financial stability.”