Brazil working on the release of CBDC by 2022

The President of the Central Bank of Brazil believes that the country will be prepared for the introduction of digital currency by then

Brazil is gearing up for the introduction of a central bank digital currency by 2022. According to Roberto Campos Neto, the President of the Central Bank of Brazil, Brazil will be equipped with an interoperable instant payments system as well as a “credible” and “convertible international currency”.

He expressed these sentiments at a Bloomberg event, which was covered by the Correio Brazilienese, a local news outlet.

“To have a digital currency, you need an instant payment system that is efficient and interoperable; an open system, where you can create competition; and a currency that has credibility, is convertible and international. After that, I think you have all the ingredients to have digital currency. We think we will have this in 2022.” Campos Neto stated.

Campos Neto also reportedly said that CBDCs follow financial systems that are quick to digitize, such as that of Brazil’s. The country’s central bank is working on rolling out its PIX instant payments system this November, as well as the launch of an Open Banking initiative later this year.

To supplement their efforts in digitizing, the central bank has also created an intergovernmental task force on August 20. The task force is composed of 12 members who are dedicated to assessing the impact of digital currencies in Brazil.

“The BC intends to investigate the scope of a CBDC, as well as the benefits for society, considering the specificities and challenges of the national context. The initiative will also assess how an electronic currency can bring complementary benefits to those that are being introduced with the implementation of Pix, an instant payment system, which starts operating in November,” the announcement regarding the task force explains.

The results of the group’s research are expected in six to 12 months.

Furthermore, Campos Neto has been in discussion with members of the parliament regarding a bill that the central bank presented in 2019 on the modernisation of the Brazilian exchange system.

While cryptocurrencies are popular in Brazil, authorities have not yet specifically regulated the creation, use, trading, or circulation of cryptocurrencies. It also does not consider cryptocurrencies as legal tender, and they are not afforded the same status as fiat currencies of other countries.

However, the significant increase of interest and engagement in cryptocurrencies has caught the eye of the government, which has been working in collaboration with the central bank and other relevant entities to provide regulatory clarity in the future.