BC President Roberto Campos Neto says that digital real should benefit from crypto tools.
“Cryptocurrency regulation dominated more than half of the last meeting of the world’s central banks. I see a certain concern, a certain apprehension. But I also see new doors opening for financial innovation, for a decentralized system that is capable of generating financial inclusion.” That’s what the president of the Central Bank (BC), Roberto Campos Neto, said at the CEO Conference of BTG Pactual, this Tuesday (22).
Thus, Campos shared information that reinforces that BC looks to decentralized solutions that run on solutions such as blockchain and distributed ledger technology (DLT).
Campos thanked Senator Irajá Abreu (PSD-TO) for approval of the proposed law to regulate the cryptocurrency segment in the Senate. This also happened yesterday, at the Economic Affairs Committee (CAE). “This project is important. It’s a first one that talks about brokers”. The BC president recalled that there is another bill in the Chamber and said he understands that there may be a combination of both.
The movement of governments around the world in relation to cryptocurrencies is to establish some form of regulation. In addition, about 90% of BCs are considering having a digital currency, called CBDCs. The one in Brazil will have a pilot in the second half of the year, said Campos Neto.
The current stage of the digital real is that the BC and Fenasbac choose the projects that financial institutions presented for testing between the end of March and the end of July. A total of 43 national and foreign companies presented 47 projects and competed to be chosen in the Lift Challenge . The initiative is from BC and Fenasbac, the federation of the bank’s servers.
The use cases of these tests focus on decentralized finance (DeFi), Delivery versus Payment (DvP), that is, simultaneous delivery to payment, and Payment versus Payment (PvP), which is the settlement of foreign currency transactions. In addition, there will be a focus on the internet of things (IoT).
“One idea that prevails and that will always prevail is that technology is the most democratizing instrument there is,” said Campos Neto. For him, technology provides inclusion with sustainability and helps to create new business models and generate competition. And “this process of innovation causes companies to be created in decentralized finance. But, he added, they are in perimeters not regulated by the BC.
“Central bankers have studied a lot how to make this approach to have a regulatory environment that encourages technology, but does not create risk for the traditional financial system, since the decentralized system grows at a much faster pace”.
Regarding crypto assets, regulators are very concerned about the asset itself. “I think it’s more important to talk about the network, the platform on which the asset navigates, than the asset itself. The platforms that are being created and what crypto has been doing in terms of improving those platforms is of enormous value.”
According to Campos Neto, in the current movement of questioning in relation to several things, especially traditional monetary policy, it is interesting to understand why investments in crypto-assets grow. On the one hand, he said, the situation is worrying due to high growth. However, it “fosters a system, a network, which will be very beneficial for the financial system in the future”.
He added that concepts of decentralization, such as that “every additional crypto you put in the system, increases its security, this concept of the network”, is important for the financial sector to absorb.
Campos Neto says he does not use the term cryptocurrencies, because they do not have the characteristics of coins. Hence, he calls them cryptoassets.
And he also said that “the next movement we are going to see is the monetization of information”. It will be a process in which the winner will be the company that gets people to monetize their data without going through intermediaries. “It’s going to be a great revolution, it’s like a new layer of the internet.”