- Brazil’s central bank president, Roberto Campos Neto, announced the country’s plan to launch its own central bank digital currency (CBDC) by the end of 2022.
Speaking at a Bloomberg-sponsored event, Roberto Campos Neto, president of the Banco Central, praised digital currency payment systems as the future of financial systems claiming the country is in the pipeline of launching their CBDC in the coming two years.
Despite starting their research on its digital payments systems and CBDC recently, Brazil aims to accelerate its efforts in the field to provide a stable and working platform by 2023. According to Neto, Brazil’s CBDC will be built on an instant payment system allowing efficient, open, and interoperable transactions across similar systems in a bid to improve the financial system.
Neto stated Brazil is ready to launch its CBDC given it has “all the ingredients” to start its CBDC project and complete it by 2022. He said,
“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 it in 2022.”
Additionally, the central bank has been working on its banking infrastructure in a bit to provide instantaneous banking settlements between peer banks. The new infrastructure, PIX, will be launched in November, allowing peer-to-peer open banking transactions that can be settled in a matter of seconds.
Neto, however, did not mention the role that the CBDC will play in its new PIX infrastructure. It is expected to be complementary to the latter. He further clarified the role of a CBDC as:
“A CBDC distinguishes itself from cryptocurrencies without national trust, like Bitcoin, because it is just a new form of representation of the currency already issued by the national monetary authority, that is, it is part of the monetary policy of the issuing country.”
With the launch of its own CBDC project, Brazil joins several countries already working on CBDC’s, including China, Japan, and Canada.