Brazil President’s public opposition to Cryptocurrency.

Recently, Jair Bolsonaro Brazil’s President came out to the public airing his anti-bitcoin stance. Brazil’s move towards cryptocurrency regulation took a step closer in the month of May as the Brasilia government had agreed and published ‘instruction 1888’.This instruction passed rules that meant individuals, legal entities and brokerage firms that carry out operations with crypto will have to inform the treasury of every detail of their transactions. It was supposed to come into play on August 1. Reportedly, the main goals of this regulation are to combat tax evasion and avoid crimes such as money laundering.

The Brazilian president commented in an interview aired on national television, on cryptocurrency being used to bank indigenous people in Brazil. The conversation was focused at the time on the challenges of his new presidency.  The present made reference to projects created by the government administration predeceasing his; he mentioned one of the efforts to embark on a project to create an “indigenous cryptocurrency” and the project estimate was $11.5 million.

Clearly, this project was still in the plans and was not yet executed but may not see the light of day by August as Bolsonaro said, “We are cutting expenses. We were about to use 40 million Reales to teach natives to use bitcoin,” and then outrightly he claimed not to know what bitcoin is saying “I don’t know,” “Is it a coin?”

The country’s Ministry of Human Rights, Family and Women vetoed in January for the project in order help bank Brazil’s indigenous people. This was after the National Indian Foundation (Funai) and the Fluminense Federal University (UFF) had created it.

In Latin America’s blockchain sphere, Brazil is one of the most active countries.  Yet, as one of the first actions taken by Bolsonaro’s administration, the cryptocurrency project was shut down. This was the first time the leader, who is serving as the 38th President of Brazil since 1 January 2019, commented about bitcoin in public.

Since crypto regulation, by way of the instruction 1888, was given a go-ahead last month but not yet implemented, this opposing stance of the new president has stirred up contention leaving Brazil’s cryptocurrency market has been in a strange state of limbo. The growing cryptocurrency and blockchain ecosystem in Brazil is still highly notable despite the president’s initial ignorance of bitcoin.

A month after his tenure began; the president showed certain preferences for blockchain when he appointed an economist involved in blockchain and cryptocurrency to run the Central Bank of Brazil. Hence, his issue seems to be against ‘bitcoin or cryptocurrencies’ not the blockchain technology.

Brazil is presently one of the biggest cryptocurrency markets in the Geo-zone and has the highest bitcoin trading volume in the entire region, reaching nearly 100,000 BTC in April alone.

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Credits – Diana Aguilar,  Gabriel Quintanilha

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